In re Applications of FLOWER CITY TELEVISION CORP., ROCHESTER, N.Y.; GENESEE VALLEY TELEVISION CO., INC., ROCHESTER, N.Y.; STAR TELEVISION, INC., ROCHESTER, N.Y.; COMMUNITY BROADCASTING, INC., ROCHESTER, N.Y.; HERITAGE RADIO & TELEVISION BROADCASTING CO., INC., ROCHESTER, N.Y.; MAIN BROADCAST CO., INC., ROCHESTER, N.Y.; THE FEDERAL BROADCASTING SYSTEM, INC., ROCHESTER, N.Y.; CITIZENS TELEVISION CORP., ROCHESTER, N.Y.; ROCHESTER BROADCASTING CORP., ROCHESTER, N.Y.; ROCHESTER TELECASTERS, INC., ROCHESTER, N.Y. For Construction Permits for New Television Broadcast Stations (Channel 13); Part 1 of 3
Docket No. 14394 File No. BPCT-2929; Docket No. 14395 File No. BPCT-2944;
Docket No. 14460 File No. BPCT-2948; Docket No. 14461 File No. BPCT-2953; Docket
No. 14462 File No. BPCT-2961; Docket No. 14464 File No. BPCT-2964; Docket No.
14465 File No. BPCT-2966; Docket No. 14466 File No. BPCT-2967; Docket No. 14467
File No. BPCT-2972 Docket No. 14468 File No. BPCT-2974
10 Rad. Reg. 2d (P & F) 1059
August 3, 1967 Adopted
JUDGES: BY COMMISSIONER LEE FOR THE COMMISSION: COMMISSIONERS BARTLEY AND JOHNSON DISSENTING AND ISSUING STATEMENTS; COMMISSIONER COX NOT PARTICIPATING; COMMISSIONER WADSWORTH ABSENT.
1. The initial decision of Hearing Examiner Annie Neal Huntting (FCC 64D-5, released Jan. 28, 1964) recommended grant of the applications of Rochester Area Educational Television Association, Inc. (RAETA), and Rochester Telecasters, Inc. (RTI). These applications, which proposed a share-time operation on channel 13 in Rochester, N.Y., were complementary and comprised a single proposal; as such they were mutually exclusive with each of eight other applications. n1 The application of Rochester Broadcasting Corp. (RBC) was denied by the examiner as in default for failure to prosecute its application. RBC has taken no exception to the examiner's recommended disposition of its application.
n1 Throughout this decision those eight applicants will be referred to as follows: Flower City Television Corp. (Flower); Genesee Valley Television Co., Inc. (Genesee); Star Television, Inc. (Star); Community Broadcasting, Inc. (Community); Heritage Radio & Television Broadcasting Co., Inc. (Heritage); Main Broadcast Co., Inc. (Main); the Federal Broadcasting System, Inc. (Federal); and Citizens Television Corp. (Citizens).
2. After exceptions, briefs, and replies had been filed to the initial decision, an oral argument was held before the Commission, en banc, on November 2, 1964. n2 During that oral argument each party was afforded an opportunity to address itself to a petition to reopen the record and to remand, which had been filed on October 15, 1964, by all of the applicants except RAETA, RTI, and RBC. After hearing oral argument, we concluded that the existing record did not contain sufficient evidence to resolve the questions of: (a) Whether alternative means were available for broadcast of the type of educational programming proposed by RAETA, and (b) whether a part-time applicant such as RTI would provide an effective competitive outlet for a third network service. Therefore, we reopened the record and remanded this proceeding for a further hearing so that such evidence could be adduced, FCC 65-403, released May 13, 1965. At the same time, we indicated that each applicant would be permitted to modify its programming proposal to reflect the evolving needs of Rochester. Before any hearing sessions were held, however, the applicants entered into a series of negotiations. As a result of those negotiations, RAETA requested the dismissal of its application so that it could use the funds it obtained as reimbursement for its expenses in connection with its application to establish a full-time educational television station on another available channel. Thereafter, RAETA 's application in this proceeding was dismissed with prejudice, 2 FCC 2d 448 and 1029 (1966), and it commenced operation of station WXXI in Rochester.
n2 The following parties filed motions to correct the transcript of the Nov. 2, 1964, oral argument: Flower, on Nov. 19, 1964; Community, on Nov. 25, 1964; Star, on Nov. 19, 1964; Main, on Nov. 13, 1964; and RTI, on Nov. 24, 1964. No objections to the motions have been filed and they will be granted.
3. In addition to the dismissal of RAETA's application, the impact of our Policy Statement on Comparative Broadcast Hearings, 1 FCC 2d 393 (1965), which was adopted after the release of the remand order, must be considered in this proceeding, since we clearly indicated that the Policy Statement would apply to all cases to be decided in the future. In the Policy Statement we noted that program plans often have to be changed to take account of new conditions when the successful applicant begins operation and that our experience indicates that the program plans of competing applicants are so similar that minor differences among them generally prove to be of no significance. For these reasons, we stated that no issue would ordinarily be designated for program plans and policies, or for staffing plans or other program planning elements, and that evidence on these matters would not be considered under the standard comparative issue. As pointed out in the Policy Statement, each applicant has the responsibility for being familiar with the community and area to be served and for proposing an adequate programming service to meet the ascertained needs and interests. From our consideration of the record in this proceeding, we are persuaded that each of the applicants has met its obligations in this respect and that variations in the respective program proposals are merely minor differences in the proportions of time allocated for varying types of programs. As we stated in the Policy Statement, such ordinary differences in judgment will not be compared in the hearing process when each of the applicants, as here, has demonstrated that it is able to carry out its proposal. n3
n3 Because of RAETA's specialized programming proposal, the standard comparative issue in this proceeding was enlarged to determine whether there were particular types or classes of programs for which there was an unfulfilled need in the Rochester area and the extent to which that need would be met by each applicant (FCC 62-385, released Apr. 13, 1962). Since, as noted above, RAETA's application has been dismissed and station WXXI has commenced operation, the evidentiary showings submitted with respect to RAETA's specialized proposal are now moot.
4. In view of these events which occurred after the release of our remand order in this proceeding, we concluded that no further evidentiary submissions would be required and that no useful purpose would be served by permitting the applicants to modify their programming proposals. Accordingly, the remand order was set aside so that this proceeding could be decided on the basis of the existing record (FCC 66-347, released Apr. 21, 1966). Subsequently, because of the circumstances which arose after the November 2, 1964, oral argument, we concluded that a further oral argument would be of assistance in resolving the remaining issues in this proceeding. That further argument, in which each of the nine remaining applicants participated, was held before the Commission, en banc, on May 22, 1967. n4
n4 Citizens filed a motion to correct the transcript of the May 22, 1967, oral argument on June 20, 1967. No objection to the motion has been filed, and it will be granted.
5. Due to the dismissal of RAETA's application, the only issues remaining in dispute in this proceeding are those concerning Star's financial qualifications, Federal's technical qualifications with respect to its antenna site, and the standard comparison of the applicants. The examiner resolved the issues concerning Star and Federal in favor of those applicants. No exceptions have been filed to these findings and conclusions, and we adopt them as our own. We have reviewed the examiner's remaining findings of fact in the light of the applicants' exceptions, and it is our view that they are substantially accurate and complete. Accordingly, they are adopted with the modifications noted herein and in the appendix to this decision, where our rulings on the applicants' exceptions to the initial decision are set forth. Although the examiner proposed to grant the share-time proposal of RAETA and RTI, RAETA has withdrawn its application, and it is apparent that the findings in this proceeding now warrant substantially different conclusions and a different ultimate result.
II. PETITIONS FOR LEAVE TO AMEND
6. Before we consider the comparative qualifications of the remaining applicants, it will be of assistance to dispose of certain petitions for leave to amend applications which have been filed by several of the applicants. The substance and disposition of each pending petition is as follows:
(a) On June 2, 1967, Flower requested leave to amend its application to reflect that one of its stockholders, Harper Sibley, Jr., has acquired an interest in Empire Broadcasting Corp., which is the assignee in an application for assignment of license of station KLIV, San Jose, Calif. (files Nos. BTC-5315 and BAL-6044). No opposition to this petition has been filed, and it will be granted. n5
n5 On Nov. 30, 1965, Flower notified us of the death of Louis A. Wehle, an 8.33-percent stockholder, and of the voluntary petition for bankruptcy filed by Paul E. McNamara, a 0.34-percent stockholder.
(b) On May 18, 1967, Star requested leave to amend its application to reflect that: (1) None of its principals has any ownership interest in stations WBBF and WBBF-FM, Rochester, N.Y.; WGVA, Geneva, N.Y.; and WTLB, Utica, N.Y.; (2) five of its stockholders, Maurice R. Forman, Robert S. Kieve, James M. Trayheren, Jr., Vincent A. Lopopolo, and Roy Wetzel, have acquired interests in Empire Broadcasting Corp., which is the assignee in an application for assignment of license of station KLIV, San Jose, Calif. (files Nos. BTC-5315 and BAL-6044); (3) three of its stockholders are connected with the University of Rochester, which owns stock in Harcourt, Brace & World, Inc., which, in turn, has filed an application for a new UHF television station in Rochester, N.Y. (file No. BPCT-3922); n6 (4) Robert S. Kieve and James M. Trayhern, Jr., have agreed, prior to moving to San Jose, to transfer portions of their interests in the applicant to Maurice R. Forman, thus reducing their stockholdings in the applicant to 5 and 2 percent, respectively; and (5) Maurice R. Forman has been elected a director of the Federal Reserve Bank of New York. No opposition to this petition has been filed, and it will be granted.
n6 By a public notice, dated June 27, 1967, we announced that the Harcourt, Brace & World, Inc., application for Rochester had been dismissed pursuant to sec. 1.568(a) of our rules. In addition, Harcourt, Brace & World, Inc., has returned the construction permits for new television stations in other communities, which it had previously obtained.
(c) On May 16, 1967, Community notified us that. (1) One of its stockholders, F. Robert Greene, is no longer connected with the application of WEXC, Inc., for a new standard broadcast station in Depew, N.Y. (docket No. 14031), which application has been dismissed by the Review Board (FCC 64R-314, released June 8, 1964); (2) the nonbroadcast business activities of F. Robert Greene have changed in certain respects; and (3) another of its stockholders, Michael R. Hanna, would completely sever his connection with Cornell University station WHCU, rather than merely taking a leave of absence from that position, in order to become Community's director of education and public affairs in the event of a grant of Community's application.
(d) On January 28, 1964, Heritage requested leave to amend its application to reflect the death of Roland G. McDonald, a 4-percent stockholder. n7 No opposition to this petition has been filed, and it will be granted. On October 22, 1964, Heritage requested leave to amend its application to reflect the death of James M. Landis, who was a joint tenant of a one-fourth undivided 2-percent interest in the applicant and to reflect the vesting of his interest in the surviving joint tenants, Justin N. Feldman, Lawrence H. Reilly, Jr., and George J. Solomon. No opposition to this petition has been filed, and it will also be granted.
n7 This petition was dismissed in our order remanding this proceeding for a further hearing, FCC 65-403, released May 13, 1965, when the applicants were directed to submit such information as part of the overall up-dating of their proposals. However, Heritage failed to resubmit this request, and the remand order was subsequently set aside, FCC 66-347, released Apr. 21, 1966. Under these circumstances, it is appropriate to consider the merits of Heritage's Jan. 28, 1964, petition at this time. Similarly, a petition for leave to amend its application, filed by RAETA on June 24, 1964, was dismissed by the remand order, and the request was never resubmitted. In view of the dismissal of RAETA's application, this petition will be dismissed as moot.
(e) On November 29, 1965, RTI filed a petition requesting leave to amend its application to specify full-time instead of part-time, hours of operation and to alter its financing proposal. Oppositions were filed by Flower, Star, Federal, Citizens, and the Broadcast Bureau, and RTI filed a reply in response to those oppositions. Because it appeared that grant of RTI's petition would require an additional hearing and would further delay the resolution of this proceeding, we concluded that RTI's petition for leave to amend its application should be denied, FCC 66-593, released July 8, 1966. During the May 22, 1967, oral argument, RTI again requested leave to amend its application to specify full-time operation and argued that a further hearing would not be required since the initial decision contains complete findings of fact with respect to all of the applicant's principals. After further consideration, we are persuaded that the public interest would be better served by permitting RTI, without altering its comparative qualifications, to bring its proposal up to date so that this proceeding can be decided on the basis of the facts as they now exist. For this reason, we shall grant RTI's request for leave to amend its application to the extent of permitting it to specify fulltime operation.
III. EVALUATION OF COMPARATIVE CRITERIA
A. Diversification of Control of the Media of Mass Communications
7. When the record was closed in this proceeding, Star, Community, and Federal each had substantial connections with other broadcast interests. As noted in paragraph 6, however, Star's principals have disposed of their interests in stations WBBF and WBBF-FM, Rochester, N.Y.; WGVA, Geneva, N.Y.; and WTLB, Utica, N.Y.; n8 and Community's stockholder, F. Robert Greene, is no longer connected with an application for a new standard broadcast station in Depew, N.Y. On the other hand, Federal continues to be connected with both station WSAY, Rochester, and station WNIA, Cheektowaga, N.Y. Federal is itself the licensee of WSAY and its 100 percent stockholder, Gordon P. Brown, is the licensee of WNIA, thus providing complete common control between the proposed television station and the two standard broadcast stations. Although WNIA is located about 70 miles west of Rochester, WSAY is located in Rochester, where Federal's proposed television station would be located. Since none of the other applicants is otherwise associated with the media of mass communications to any significant extent, n9 we conclude that an equal preference must be given to each of those applicants over Federal on this very important criterion. While the weight of those preferences is diminished somewhat by the existence of other media of mass communications in the Rochester area, the preferences still must be considered substantial in this proceeding because each of those applicants would provide a new voice in the Rochester area. For these reasons, we conclude that each of the other applicants must be given a substantial preference over Federal with respect to the diversification of control of the media of mass communications.
n8 Although both Star and Flower have amended their applications to reflect an ownership interest in the assignee of standard broadcast station KLIV in San Jose, Calif., by certain of their stockholders, we are not persuaded that such ownership interests should be given any significant weight in this proceeding, in view of KLIV's distance from Rochester and the less than controlling interests held.
n9 Under the circumstances of this proceeding, we are convinced that the facts with respect to Genesee's alleged connection with the Gannett Co., Main's connection with a common carrier service, and Citizen's connection with a local FM station are not sufficient to warrant an adverse conclusion as to any of these applicants.
B. Participation in Station Operation by Owners
8. On this important factor all of the applicants, with the exception of Genesee and Heritage, propose full-time participation by a substantial percentage of the stock ownership, but none, with the exception of Federal, proposes to have more than one-half of the ownership interest represented in full-time station operation. Genesee has no fulltime participation by any person with an ownership interest and Heritage has almost none. Federal has 100 percent integration of ownership with management. In addition, Federal's participation is by a long-term local resident with many years of radio experience. Federal, therefore, is to be substantially preferred over the other applicants on this factor. Among the other parties with substantial integration, Flower ranks the highest, in view of the broad broadcasting, and particularly television, experience of G. Bennett Larson, and of the somewhat lesser broadcast experience of Gordon Auchincloss II. We recognize that the integration of Flower is not accompanied by past local residence, and that in this respect it is not the equal of RTI, Star, Main, and Federal. However, in view of the fact that the great majority of Flower's stock is held by persons with area a familiarity and the further fact that the great majority of its stock is also held by persons who will devote some time to the operation of the station, as is also true of most of the other applicants, we do not believe that in this particular case the absence of past local residence by the two stockholders participating full time in the operation of the station is so significant. In addition, as we noted in the Policy Statement, persons participating full time in station operation by definition will become local residents. In view of our conclusions, we do not believe further ranking of the other parties, some of whom are very close, is necessary on this issue.
C. Proposed Program Service
9. In view of our discussion with respect to this criterion in paragraph 3, supra, we are convinced that none of the applicants is entitled to a preference over any of the other applicants on the basis of its preparation and planning, its staffing, or its program policies and proposal.
D. Past Broadcast Record
10. Among the applicants, Star, Community, and Federal presented evidence with respect to the operation of broadcast stations in which their principals held an ownership interest. n10 In the Policy Statement, supra, we stated that a past broadcast record within the bounds of average performance will be disregarded, since at least average future performance is expected. Thus, unless such a record is unusually good or unusually bad, it will not be given weight in the comparative analysis. The examiner's findings establish that both Star's and Federal's broadcast stations have adopted a music and news programming format. Although each has provided some local live programming and some nonentertainment programs, we are not persuaded that any of the stations has shown such an unusual degree of attention to the public's needs and interests as to establish an unusually good past broadcast record. In view of the average performance by each of these stations, we conclude that neither Star nor Federal is entitled to a preference over any of the other applicants with respect to this criterion.
n10 Although Larson, who is a 10-percent stockholder in Flower, had an ownership interest in station KDYL-AM and KDYL-TV in Salt Lake City, Utah, during the period 1953-59, no exception was taken to the examiner's finding that the information in the record was not sufficiently comprehensive to form the basis for a judgment with respect to the operation of those stations.
11. On the other hand, Community has made a showing concerning the broadcast record of station WHAM during the period its 15 percent stockholder, F. Robert Greene, was 50 percent owner and general manager of that station. At the time of WHAM's acquisition by Greene in 1956, the assignee proposed to limit entertainment programming to approximately 70 percent of the broadcast schedule. During the 1958 composite week, entertainment programming comprised only 62.4 percent of the broadcast schedule, live programming was broadcast 24.48 percent of the time and, except for discussion programs, the promised percentages in the nonentertainment categories were exceeded in every instance. Community's showing demonstrated that talks, interviews, and discussions on community issues and problems were carried on WHAM in several regularly scheduled entertainment and talk programs. In addition, WHAM carried regularly a weekday 5-minute commentary on local events and a 30-minute Sunday afternoon roundtable discussion of local projects and problems. In view of the facts that Greene was general manager and an owner of WHAM during this period n11 and that Greene proposes to be active in a full-time supervisory capacity in Community's proposed station, we are convinced that Community must be given credit for the commendable record of performance compiled by WHAM while Greene was associated with it. For these reasons, we conclude that Community is entitled to a preference over all of the other applicants on the basis of its 15 percent stockholder's relationship to WHAM's past broadcast record.
n11 Although Greene retained his interest in WHAM and in two other stations for less than 3 years, we are not persuaded that such a fact should preclude consideration of the merits of WHAM's past broadcast record in our comparison of all the applicants.
E. Other Criteria
12. None of the applicants claims a preference with respect to the efficient use of this television channel, and, accordingly, we do not find any difference among the applicants with respect to this criterion. Although we have indicated that a comparative hearing should not be converted into a searchfor remote and insignificant blemishes on the applicants' reputations, the Policy Statement notes that substantial character deficiencies may warrant disqualification or a demerit in the comparative analysis. In this proceeding, the examiner made findings concerning the qualifications of Heritage's president, director, and 2 percent stockholder, Bernard P. Birnbaum. The record establishes that Birnbaum was chairman of the board of directors and one of four promoters of the Faradyne Electronics Corp. when the Securities & Exchange Commission suspended the effectiveness of two registration statements filed by the corporation. In support of its action, the Securities & Exchange Commission stated that the corporation had filed unreliable and materially false and misleading registration statements in an effort to raise public funds, most of which were to be used to make payments to the corporation's promoters pursuant to transactions either not revealed or described in deceptive terms. Although given an opportunity to show that he had no knowledge, responsibility, or involvement in these matters, Birnbaum merely stated that he never did any active work for the corporation. Under these circumstances, we are convinced that this must be considered to be a substantial reflection on Birnbaum's and Heritage's character qualifications, and that a comparative demerit must be assessed against Heritage because of Birnbaum's connection with the corporation's misconduct.
13. We believe that the public interest would best be served by a grant to Flower. We conclude that no preferences are warranted with respect to the proposed program services and the efficient use of this television channel. In view of Birnbaum's connection with the Faradyne matter, we hold that a comparative demerit must be assessed against Heritage. We find no significant difference among the applicants on diversification of control of mass communications media, except that, as pointed out above, Federal has other broadcast interests, including station WSAY in Rochester. The other important factors involved in this case are participation in station operation by owners and past record. On participation we have preferred Federal with Flower second, and on past record have given a preference to Community above all of the other applicants. We believe that Flower is to be preferred to Federal because of Federal's existing broadcast interests; we feel that the public's interest in a television station in Rochester which will provide an entirely new viewpoint in broadcasting not associated with any existing station is more important than the greater ownership participation which would be provided by Federal. We prefer Flower to Community because of Flower's superiority in the area of participation in station operation. This superiority arises from the experience factor. (We note that Community's participating stockholders also lack area familiarity.) We feel that Community's past record, while commendable, has not been shown to be so outstanding as to warrant substantial weight, since the past record is not that of Community itself, but rather of a 15-percent stockholder (and proposed general manager) who was a 50 percent owner of the station whose record is involved. For the foregoing reasons we have determined to make the grant to Flower.
14. Accordingly, it is ordered:
(a) That the motions to correct the transcript of the November 2, 1964, oral argument, filed November 13, 1964, by Main; November 19, 1964, by both Flower and Star; November 24, 1964, by RTI; and November 25, 1964, by Community, Are granted.
(b) That the motion to correct the transcript of the May 22, 1967, oral argument, filed June 20, 1967, by Citizens, Is granted.
(c) That the petition for leave to amend its application, filed June 2, 1967, by Flower, Is granted.
(d) That the petition for leave to amend its application, filed May 18, 1967, by Star, Is granted.
(e) That the petitions for leave to amend its application, filed January 28 and October 22, 1964, by Heritage, Are granted.
(f) That the petition for leave to amend its application, filed on June 24, 1964, by RAETA, Is dismissed as moot.
(g) That the memorandum opinion and order (FCC 66-593, released July 8, 1966) Is set aside and that the petition for leave to amend its application, filed on November 29, 1965, by RTI, Is granted to the extent reflected in paragraph 6(e) of this decision.
(h) That the application of Flower City Television Corp., file No. BPCT-2929, for a construction permit for a new television broadcast station to operate on channel 13 in Rochester, N.Y., Is granted; and that each of the other applications designated in the caption of this decision Is denied; and
(i) That the construction authorized herein is subject to the condition that the ability of standard broadcast stations WBBF, WROC, WHEC, and WSAY to operate in accordance with the terms of their licenses shall not be adversely affected thereby, particularly with respect to their radiation patterns, and that at least five field intensity measurements on each radial established during the last proof of performance for each of these standard broadcast stations shall be submitted with the television application for license to prove that such patterns have not been materially affected.
FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.
DISSENTING STATEMENT OF COMMISSIONER ROBERT T. BARTLER
In this decision, the Flower application is not preferred in any of the six comparative criteria, yet it is granted and the other nine applications are denied.
I dissent and vote to grant the application of the Federal Broadcasting System, Inc.
The majority decision awarded a substantial preference to Federal in the comparative criterion of "participation in station operation by owners." There can be no argument with that finding. Federal is the only applicant herein having 100 percent integration of ownership with management, and that is by a long-term local resident with many years of radio experience. In terms of the likelihood of effectuation of proposals, greater certainty lies, I believe, with an applicant whose knowledge of local needs is brought to the day-to-day management and operation of the station. Gordon Brown, Federal's sole stockholder, would devote 40 hours per week as general manager. With his lifetime residence in Rochester, his long association in the broadcasting industry, and his operation of a radio station (WSAY) in Rochester for many years, Gordon Brown (Federal), of all of the applicants herein, makes the most convincing showing that the views of the locally oriented ownership would be directly translated into the daily operation of the station and that the licensee would remain aware of and responsive to community needs on a continuing basis. None of the other applicants herein proposes to have more than one-half of the ownership interest represented in full-time station operation.
I disagree further with the finding in the majority's decision that Flower ranks second to Federal in the criterion of "participation in station operation by owners." As the decision seems to admit, the fact that most of the Flower stock is held by persons with area familiarity and by persons who will devote some time to the operation of the station is also true of most of the other applicants. Thus, Flower should be rated equal to, and not superior to, applicants other than Federal.
The majority decision awards each of the other applicants a substantial preference over Federal on the comparative criterion of "diversification of control of the media of mass communications" because Federal is the licensee of WSAY, Rochester, and its 100 percent stockholder, Gordon P. Brown, is the licensee of WNIA, Cheektowaga, N.Y. The weight of those preferences is diminished substantially, in my opinion, by the existence of 16 broadcast stations licensed in Rochester (six AM, seven FM, three TV, including channel 13). I agree that, as set forth in our Policy Statement on Comparative Broadcast Hearing, diversification of control of media of mass communications is a primary factor in comparative considerations. However, it is my position that, in diversification of control of media, a licensee's facilities, i.e., AM, FM, TV, make up a broadcast unit. As technical advancements were made, and an AM licensee added FM and TV to enhance its broadcast service in the community, I believe the public interest was benefited. Thus, I find generally that a proposal to add a facility to such a locally oriented unit is in the public interest and not subject to demerit per se. See my concurring statement in
Peoples Broadcasting Corp., docket No. 15619 (May 19, 1967). The majority here states that the preferences to the other applicants "must be considered substantial in this proceeding because each of those applicants would provide a 'new voice' in the Rochester area." I disagree. I believe that more basic than the matter of a "new voice" is the quality of the "voice" that is added to the area.
In my evaluation, the preference of each applicant over Federal on diversification of control of mass media is reduced from substantial to slight, and Flower's second place to Federal is reduced to equal status with the applicants other than Federal.
With Flower receiving no preference in any of the comparative criteria, even pursuant to the majority decision, I believe that a grant is not supported. As indicated above, I believe that the preference for Federal is decisive and that its application should be granted in the public interest.
DISSENTING OPINION OF COMMISSIONER NICHOLAS JOHNSON
I have indicated before my concern that the comparative hearing process is a thoroughly unsatisfactory way to award valuable broadcast properties. Farragut Television Corp., 8 F.C.C.2d 279, 285 (1967) (dissenting statement). No better example could be chosen to demonstrate this than the case which the Commission decides today.
At stake is a Rochester, N.Y., UHF station which will likely be worth about $4 million as soon as it is operating with a 3-year license and a network affiliation. Thus, understandably, there are nine contenders in the ring battling for the construction permit after which the award of a regular license is a formality.
First, the case is an example of the intolerable delay which can accompany the comparative process. Designation for hearing was on November 15, 1961. Further appeals seem likely, and remand and further hearings are, at least, possible. But, even if the present decision survives appeal, the case will have taken 6 years for resolution.
But more fundamentally disturbing than the delay is the unsatisfactory result which the Commission eventually reaches. The point is not that I would award the construction permit to a different applicant than has the Commission. I would, but my preference is not a strong one, and the Commission's choice is quite satisfactory. The point is that there is so little in the way of significant differences among most of the nine applicants that the extraordinary
marathon conducted by the Commission and the applicants has produced no more satisfactory result than would a drawing from a hat.
The Commission's choice to run this Rochester station is Flower City Television Corp. Flower is chosen over the eight other applicants because it ranks second in what we call the "integration of ownership and management" (and the majority here calls "participation in station operation by owners"). The first in this regard, Federal Broadcasting System, Inc., unlike Flower, has a substantial detriment on other grounds. But it is clear that the preference for Flower over the other applicants on "integration" cannot be very great. Less than 20 percent of Flower's stock is held by persons intending to participate in station affairs on a full-time basis. Federal's one stockholder will be active in station affairs on a full-time basis, and four other applicants have more full-time integration than Flower. The majority is able to point to other related facts to bolster Flower's position on integration. Almost 80 percent of its shareholders will devote some time to the station, but four of the other candidates exceed Flower in this showing. The majority also points to Flower's stockholders who are familiar with the Rochester area, but none of these plan full-time devotion to station affairs, and as much area familiarity is also found in several of the other applicants. Likewise, Flower's percentage of fully "integrated" shareholders with broadcast experience, also alluded to by the majority, is exceeded by several of the other applicants.
It may well be that, by combining all these factors and calling them by the undescriptive title "integration of ownership and management" or "participation in station operation by owners," it is possible to conclude that Flower ranks second to Federal on this criterion for selection. But it is quite clear that the choice is not a certain one, and that the Commission might, with a colorable justification, have chosen a number of the other applicants over Flower.
Although Federal clearly excels in the "integration" showing, I would have to agree with the Commission that it should not be awarded this station. Federal is the only applicant which already controls a Rochester broadcasting station. I attach great importance to diversifying control of broadcast media both in the country and in individual communities. Thus, I cannot agree with Commissioner Bartley that a licensee should be allowed an AM, an FM, and a TV station in any community before he receives a diversification demerit. On the contrary, local diversification seems even more important to me than national diversification.
Forced to vote for one of these nine applicants, I would choose Community Broadcasting, Inc. Community ranks well down the list in the integration factor. But, as the Commission notes, it deserves a preference for its past broadcast record, because its proposed general manager and significant stockholder has a commendable record.
I do not make this judgment confidently, for it appears to me impossible to make meaningful distinctions between applicants with such insignificant and noncomparable differences. The comparative process for selection of broadcasting licensees is a sad commentary on the American administrative process. The basic bankruptcy of the approach and the absence of any correlation between the results reached and any discernible policy has been demonstrated long ago. I am neither the first to feel or to say this, yet neither Congress nor this Commission has made necessary moves to change the process -- a change which is long overdue.