Back to Index

 

 

 

 

 

 

In re Application of JOHN POOLE BROADCASTING CO., INC., AND KBIQ, INC.. (ASSIGNORS) AND BONNEVILLE INTERNATIONAL CORP. (ASSIGNEE) For Assignment of Licenses of Station KBIG, Avalon, Calif., and Station KBIG-FM, Los Angeles, Calif.

 

File Nos. BAL-6373 and BALE-1108

 

FEDERAL COMMUNICATIONS COMMISSION

 

16 F.C.C.2d 458 (1969); 15 Rad. Reg. 2d (P & F) 609

 

RELEASE-NUMBER: FCC 69-118

 

February 7, 1969 Adopted

 


 

BY THE COMMISSION: COMMISSIONERS BARTLEY AND JOHNSON DISSENTING AND ISSUING STATEMENTS; COMMISSIONER COX DISSENTING; COMMISSIONER H. REX LEE CONCURRING AND ISSUING A STATEMENT.

 

[*458] 1. The Commission has before it for consideration the above-entitled applications.

 

2. The proposed assignee, a wholly owned subsidiary of the corporation of the president of The Church of Jesus Christ of Latter-Day Saints (parent corporation) is the licensee of stations KMBZ-AM and KMBR-FM, Kansas City, Mo., and has an interest in or controls the following broadcast stations: an AM, FM, and TV combination in Salt Lake City, Utah, Idaho Falls, Idaho, and Seattle, Wash., and a commercial FM and an international short wave station in New York, N.Y. Additionally, Brigham Young University, owned by The Church of Jesus Christ of Latter-Day Saints, is licensee of noncommercial stations KBYU-TV and KBYU-FM, Provo, Utah.

 

3. The Church of Jesus Christ of Latter-Day Saints through its subsidiaries owns 4.79 percent of the Times Mirror Corp. which has long been controlled by the Chandler family. The Times Mirror Corp. publishes the Los Angeles Times and the Orange Coast Daily Pilot. The latter is a daily -- except Sunday -- paper with separate editions for Costa Mesa and five other Orange County, Calif. Communities with a combined circulation of 33,676. The assignee states that these shares of Times Mirror stock are "* * * held solely for investment * * *" and that the parent corporation has no representation on the Board of Directors or among the officers of Times Mirror. The Times Mirror stock was acquired in 1965 by the parent corporation-owned Deseret News Publishing Co., publisher of the Deseret News in Salt Lake City, when it sold out its minority interest in a newsprint company to the Times Mirror Corp. in exchange for Times Mirror stock.

 

[*459] 4. The assignee has adequately met the Commission's programming survey requirements. In addition to interviewing numerous community leaders in the Los Angeles and Avalon area, assignee also had a professional audience survey conducted to obtain the opinions of average radio listeners in the coverage areas. The assignee has submitted summaries of 34 interviews with community leaders in connection with its AM survey and summaries of 116 interviews with community leaders which it conducted in connection with its FM survey. These community leaders included mayors, city councilmen, sheriffs, judges, school principals, religious leaders, chamber of commerce leaders, representatives of the U.S. armed services, librarians, etc.

 

5. As a result of these interviews and the data from its professional audience survey, assignee has determined that there is a need in the Los Angeles and Avalon areas for expanded local and national news and adult oriented programming in which news, public affirs, educational, religious and other public service programming will be well balanced with adult music throughout the broadcast day. The proposed general format of both stations, except for the early Sunday morning periods which contain religious and public affairs programs, is standard popular music interspersed with 5 minutes of news and/or weather per hour and anywhere from one to three 1-minute vignettes described as "public affairs," "educational" or "religious programs." Ninety-four of these programs per week are proposed for the AM and 194 per week for the FM, under the following titles and program types: Devotional, (R.); Educational News (Ed.); Library Report (Ed.); Better Business Bureau (I); Food Tips (I); Editorial (I).

 

6. Assignee states that the programming of KBIG-FM will duplicate the programming of KBIG-AM for "* * * 6 hours a day, but not to exceed 49 percent of KBIG-AM broadcast time." There was no duplication by KBIG-FM during the composite week, but assignor states that as of March 18, 1968, KBIG-FM has been duplicating the programming of KBIG-AM during the hours of sign-on to 10 a.m., Monday through Friday only.

 

7. The proposed programming compared with the past programming for each of the stations is as follows:

PAST

 

 

 

Percent of

total time

on air

 

 

Percent of

total time

on air

 

 

Hours

Minutes

Hours

Minutes

 

 

 

 

 

 

 

KBIG-AM

 

 

News

6

7

7.4

4

4

3.1

 

Public affairs

 

All other

programs,

exclusive of

entertainment

 

and sports

8

37

10.4

 

 

Total

broadcast hours

per week

 

 

82 1/2

 

 

130

 

 

 

 

PROPOSED

 

 

News

6

18

9.0

10

30

5.25

 

Public affairs

 

1

6

1.5

1

10

.69

 

All other programs,

exclusive of entertainment

and sports

 

 

 

 

2

49

4.02

4

52

2.89

 

Total broadcast

Hours per week

 

 

 

70

 

 

168

 

 

 

 

[*460] 8. The normal commercial limitation for the proposed operation of both stations is 18 minutes per hour which may be exceeded during: (1) political campaigns; (2) special programming which preempts regularly scheduled advertising; (3) public emergencies; (4) equipment failures; (5) suspension of broadcasts; and (6) special community events. Concerning the frequency of the expected overages and the limits which would then apply, assignee states as follows:

BIC will exert its best efforts to assure that in the event any of the above-enumerated exceptions occurs, KBIG or KBIG-FM will not broadcast more than 20 minutes of commercial matter per hour. However, should an exceptional circumstance arise where BIC believes it would be in the best interest of the public in the southern California area to increase its number of commercials beyond the 20-minute limitation, it will promptly so inform the Commission. If at all possible, the Commission will be informed prior to said temporary overage.

 

9. The stations being acquired by the assignee are located in the Los Angeles market and the acquisition thereof present no question of regional or national concentration of control. A grant of the applications is consistent with the Commission's multiple ownership rules and the policies established thereunder over the past several years. The applicant is qualified in all other respects and we find, therefore, that a grant of the above-entitled applications would serve the public interest, convenience, and necessity.

 

10. Accordingly, the above-entitled applications Are granted.

 

FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.

 


 

CONCURRING OPINION OF COMMISSIONER H. REX LEE

 

I join the majority decisions to approve the transfer of WTVM (TV), Columbus, Ga. and WTVC(TV), Chattanooga, Tenn. to Fuqua Industries, Inc.; of WRTH, Wood River, Ill. to Avco Broadcasting Co.; and KBIG, Avalon, Calif. and KBIG-FM, Los Angeles, Calif. to Bonneville International Corp.

 

I take such action because the proposed transfers conform to existing Commission laws, regulations and public interest standards. The FCC, through orderly procedure, has established rules and guidelines in the realm of media concentration. But these rules do not go far enough. They do not specifically spell out the line of public interests which broadcasters may serve in the fulfillment of substantial public objectives.

 

In view of this situation, a hearing is not deemed necessary. The scope of questions addressed to media concentration is narrowly confined by FCC multiple ownership rules. In these cases, this results in neither the public interests nor the interests of fairness in administrative due process being served by an evidentiary hearing. Even in such an examination, the lack of standards makes it difficult for the interested parties, including the public, to present evidence, and for the Commission to make a sound judgment. The argument is noted that under existing Commission procedures, the hearing process is frequently the equivalent of a denial -- if for no other reason than the amount of time and expense consumed by it. It is hoped these two hardships of the hearing process can be alleviated through the development of new procedural standards which may be applied when needed.

 

Nevertheless, there is concern in various quarters about the growth of media concentration. The political, social and economic influence, concentrated in a few broadcast facilities, raises fears -- a dimension of which cannot be dispelled by the Commission's multiple ownership rules.

 

The FCC's examination of this problem must keep pace with the changing complexion of the broadcast industry. In this period of change, the FCC is in transition between its existing rules and the formulation of new standards. This means that parties to Commission transfer proceedings also find themselves in a difficult position. It is [*466] often impossible for them to prior assess whether their transfer proposals will constitute a prohibited media concentration. In fact, there is virtually no way of knowing what is or is not prohibited. These difficulties are magnified because the FCC lacks adequate standards by which to judge the nature of these new developments. This not only creates problems for the Commission, but causes confusion within the broadcasting industry.

 

Therefore, I am pleased that the Commission is issuing a public notice of inquiry. It is hoped that the inquiry will result in the formulation of more precise standards which will better serve the public interest, as well as afford the broadcasting industry an opportunity to see where it stands.

 

The Commission should consider the findings which emerge from such an inquiry in processing normal filings. For certainly, if standards are derived by which a more meaningful test of public benefits can be proved, the course of future actions will be carefully distinguished. In sum, I stress that I intend to examine future cases very carefully to determine what public benefits will result.

 


 

DISSENTING STATEMENT OF COMMISSIONER ROBERT T. BARTLEY

 

In the absence of rules prohibiting continuing concentration of the broadcasting structure, the only alternative is through the hearing process where case law can be applied. The mere pendency of an inquiry will not serve to halt the present trend. In the interim, I believe we should institute hearings where concentration is increased.

 


 

DISSENTING OPINION OF COMMISSIONER NICHOLAS JOHNSON

 

Bonneville International Corp. receives approval today from this Commission to add to its stable of industrial and mass media properties an AM radio station, and an FM radio station, in the second largest market in the United States: Los Angeles -- a city in which it already has a $20 million interest in the prestigious and dominant Los Angeles Times.

This action is taken without a public discussion of the principal issues raised by this case: the conflicts with the public interest in granting ever-increasing mass media power -- with all its economic, political, and social implications -- to large industrial conglomerate corporations in the United States, in this case an industrial conglomerate that is inexorably intertwined with a religious sect, the Mormon Church. n1

 

n1 Much of the general discussion in the recent KSL license renewal reconsideration is also relevant here. See, KSL, F.C.C. 69-40 (1969).

 

[*461] Originally not deigning to issue even a skeleton order in the case, the majority has now prepared an opinion, and I have revised this dissenting statement accordingly. It has now provided a dry recitation of the corporation's undistinguished programming proposals, its skimpy local surveys, and its commercial content -- 18 minutes per hour, except for five categories of exceptions. But after reciting some of the church's other properties, its discussion of the ownership issues is only to be found buried in two short sentences in the last paragraph. The majority's analysis reads, in its entirety, as follows:

 

The stations being acquired by the assignee are located in the Los Angeles market and the acquisition thereof present [sic] no question of regional or national concentration of control. A grant of the applications is consistent with the Commission's multiple ownership rules and the policies established there-under over the past several years.

 

It might have been better had it stuck with issuing no opinion at all. Apparently the Commission's position on ownership is now so bankrupt that past errors must serve as the structural braces for actions in the public interest.

 

How ironic that this Commission has also, today, issued a notice of general inquiry into the question of conglomerate ownership of the mass media. Inquiry into the ownership of broadcast stations by persons or entities with other business interests, docket No. 18449, F.C.C. 69-117. In that action the Commission takes note of the fact that

 

There is today a heightened interest generally in the problems posed by conglomerate merger trends, and we believe it appropriate to focus on such problems as may be presented in the broadcast field by conglomerates * * *.

* * *

 

It [the Commission] will * * * look for possible hazards to the fair and free presentation of material by the stations owned by conglomerates * * *, reciprocity arrangements in advertising, lack of licensee responsibility due to inadequate supervision by top officials, siphoning of broadcast profits for other operations or acquisitions, increased leverage either in the broadcast or non-broadcast fields, and the possible impediments to technological developments.

 

The foregoing is simply a skeletal outline of the Commission's interest, with a few examples to point up its scope. It is, we stress, a broad-ranging inquiry to encompass the possible social, economic, and political consequences in the broadcast field of the conglomerate trend and of the licensing of broadcast stations to any other person or entity with other large-scale business interests.

 

Whatever all this language may mean, it is obvious that the Commission is taking public notice of the fact that "grave doubt [exists] as to whether such assignments are in the public interest."

 

The last time this Commission issued a general inquiry into ownership matters and the same day approved a case seemingly contrary to the standards newly proposed it was reversed by the U.S. Court of Appeals:

 

The Communications Act requires the Commission to designate an application for hearing if a substantial and material question of fact is presented or if the Commission is unable, for any reason, to find that the public interest, convenience, and necessity would be served by granting the application. The public welfare requires the Commission to provide the "widest possible dissemination of information from diverse and antagonistic sources" and to guard against undue concentration of control of communications power. The Act expressly prohibits assignment of a broadcast license "except upon application to the Commission and upon finding by the Commission that the public interest, convenience, and necessity will be served thereby."

* * *

 

[*462] Assuming for sake of discussion that in a proper case such finding of public interest may be implied, certainly that finding cannot fairly be inferred when the decision was made without a hearing or any statement of reasons, and at a time when the Commission's contemporaneous action revealed at least grave doubt as to whether such assignments are in the public interest. For on the same day, and in the same Commission meeting at which the WFMT (FM) assignment was approved, the Commission adopted a notice of proposed rule making which would prohibit such an acquisition in the future as on its face contrary to the public interest.

 

Joseph v. FCC, 13 P. & F. Radio Reg. 2116, 2121-22 (D.C. Cir. 1968). I have considerable difficulty distinguishing the spirit -- if not the literal holding -- of that case from the one before us.

 

At the very least, I do not believe it is adequate to say, as has Commissioner Rex Lee in a separate opinion concurring in each of today's decisions, that [The] proposed transfers conform to existing Commission laws, regulations, and public interest standards. The FCC, through orderly procedure, has established rules and guidelines in the realm of media concentration. But these rules do not go far enough.

* * *

 

[There] is concern in various quarters about the growth of media concentration. The political, social and economic influence, concentrated in a few broadcast facilities, raises fears -- a dimension of which cannot be dispelled by the Commission's multiple ownership rules.

 

* * *

 

[P]arties to Commission transfer proceedings also find themselves in a difficult position. It is often impossible for them to prior assess whether their transfer proposals will constitute a prohibited media concentration. In fact, there is virtually no way of knowing what is or is not prohibited media concentration. In fact, there is virtually no way of knowing what is or is not prohibited. These difficulties are magnified because the FCC lacks adequate standards by which to judge the nature of these new developments. This not only creates problems for the Commission, but causes confusion within the broadcasting industry.

 

The parties before this Commission have the burden of proving to the satisfaction of a majority of the Commissioners that the public interest, convenience, and necessity will be served by the transfer of license, section 310(b). The burden is not upon the seven of us, or the occasional protester, to prove that the public interest will be somehow harmed.

 

I would be the last to urge that all the evidence is in and that conclusions are irrefutable with regard to the consequences of trends in media ownership upon the public interest in a Nation dedicated to informed self-governing by the people. That is why I support our general inquiry. I probably feel as deeply as any Commissioner this agency's lack of fully adequate data and analysis for addressing these issues. But that does not remove from our shoulders the responsibility for casting votes. We must go on the best we have.

 

Dr. Wilbur Schramm has spoken of other threats from the mass media by saying they were "[dangers] to which we need not expose our children any more than we need expose them to tetanus, or bacteria from unpasteurized milk." That is the way I feel about the threats to our deomcratic society from the ownership of the mass media -- by local media monopolies, by regional concentrations, by multimedia owners, by chain and multiple-station owners, and by conglomerate corporations. There is evidence that these threats are real and with us. [*463] See, for example, the material cited in the text and footnotes of the ABC-ITT opinions and the Chet Huntley conflict-of-interest case. ABC-ITT Merger, 7 F.C.C. 2d 245, 278 (1966); 7 F.C.C. 2d 336, 343 (1967); National Broadcasting Co., 14 F.C.C. 2d 713, 718, 741 (1968). The arguments about the benefits of such ownership have come to me principally, if not exclusively, from those whose personal or corporate economic interests were served thereby. I would welcome an opportunity to examine the evidence and arguments of benefits that might be mustered by some intellectually competent and truly independent source. I hope we will get such from our inquiry.

 

There is no irremediable harm that can possibly come to our Nation by failing to approve applications. Listeners and viewers will continue to get service from someone's operation of the stations in question. (And even if they did not, where there are competing media in the larger cities, one might argue that such a result would not be the ultimate national disaster either.) If, as a result of our inquiry, we should decide that the benefits of such ownership outweigh the burdens and the risks -- that is, that the public interest is served thereby -- then there will be time enough for these applicants before us to make new applications to us for these, or other, properties. There may be some private harm, yes. Stock prices or dividends may even be a little lower than they might otherwise be for the corporations involved -- though I doubt it. But private interest is not our statutory Polaris.

 

But there is irremediable harm that may come to the public interest from our approval of these applications. Properties once acquired are only rarely surrendered involuntarily. If that is not a principle of law or economics, it comes close to being a law of politics. If, as a result of our general inquiry we should decide that there are very persuasive reasons why today's actions should not have been approved, we are unlikely to have much luck unscrambling the omelet.

 

The evidence before me is sketchy, but it is unquestionably enough to bring me to the conclusion that the parties have not carried their burden of proving to me that the public interest is served by this transaction. I would be willing to reconsider the matter after our inquiry. I am unwilling to put my name to a public interest finding today. And if there were any more doubt in my mind, as there appears to be in the mind of Commissioner Rex Lee, I would have been inclined to vote "abstain" rather than "concur" -- if I correctly interpret his opinion. But he is a gentleman of uncommon intelligence, courage, and commitment to the public weal, and there is no doubt in my mind that he has, and will continue to, vote his conscience on these matters.

 

Having said all this, I would like to provide a brief recounting of the interests of the applicant in order to more fully demonstrate the problems I believe this particular case raises.

 

Bonneville International Corp. is a subsidiary of Deseret Management Corp., which is a subsidiary of The Corporation of th8e President of the Church of Jesus Christ of Latter-day Saints (the Mormon Church). The Mormon Church already has substantial media interests in Los Angeles, owning 5.12 percent of the Times-Mirror Corp., a [*464] media giant in its own right and publisher, among other papers, of the Los Angeles Times. (The corporation owns a string of newspapers in California, and was recently ordered by the U.S. Department of Justice to divest one of them.) The Commission is assured that this 5.12 percent is "held solely for investment." But there is no information presented to the Commission by the applicant or our staff as to the size of other shareholders in the Times-Mirror Corp. (A 5.12 percent interest in a publicly-held corporation is often sufficient for substantial influence.)

 

In addition to its present and newly-acquired media interests in Los Angeles, the Mormon Church also owns or has substantial interests in the following media properties (with a heavy emphasis in the Rocky Mountain area): KSL-TV-AM-FM, Salt Lake City, Utah; the Deseret News, a daily newspaper in Salt Lake Ciyt; KID-TV-AM-FM, Idaho Falls, Idaho; KIRO-TV-AM-FM, Seattle, Wash.; KMBZ-AM and KMBR-FM, Kansas City, Mo.; WRFM, New York, N.Y.; educational stations KBYU-TV-FM, Provo, Utah; and even one of this country's three privately-owned international short wave stations, WNYW, New York, N.Y. The Deseret News and the Salt Lake Tribune jointly own the Newspaper Agency Corp., under a joint operating agreement of the type recently attached by the Department of Justice. The Salt Lake Tribune has a substantial interest in Salt Lake City TV station KUTV-TV. This station, in turn -- with the third TV station, KCPX-TV and KSL-TV -- has formed a triple joint venture to operate the Salt Lake City CATV franchise. For a fuller detailing of the Mormon Church's implications in media ownership in Utah see, "Hearings Before the Subcommittee on Antitrust and Monopoly of the U.S. Senate Committee on the Judiciary," The Failing Newspaper Act, pp. 328-69; 892-905 (1967); and Commissioner Cox's dissenting opinion in the Commission's renewal of the KSL licenses, F.C.C. 68-1005 (1968). The extent of the Church's national media power, especially in the western regions, is obvious from the mere listing of these properties and business relationships.

 

But the Mormon Church is not only a media baron of substantial proportions, it is also a significant industrial conglomerate corporation. Its holdings are reported to include a 50 percent interest in the Utah Idaho Sugar Co. (beet sugar); its $20 million investment in the Los Angeles Times; a 25 percent interest in Zion's Cooperative Mercantile Institution (a Salt Lake City department store); Hotel Utah and Hotel Temple Square in Salt Lake City; Beneficial Life Insurance Co. (insurance in force of $535 million); Home Fire Insurance Co.; Deseret Book Store; Deseret Farms, Inc.; Deseret Farms of Florida, Inc.; Zion's Securities Corp. (real estate management); a trucking company; a pineapple plantation; three large ranches in Canada; a total of 600 farms, 40 mills, factories, and salvage stores; a 6,500 acre sugar plantation in Hawaii; and 360,000 acres (another source indicates 700,000 acres) in Florida. [Material in this part is drawn from Mullen, "The Latter Day Saints," 205-07 (1966); Whalen, "The Latter-day Saints in the Modern World," 152-53 (1964); and Turner, "The Mormon Establishment," 102-36, 267-94 (1966).]

 

[*465] This combination of media and other economic power raises a final issue -- the domination of a city, State, and region by a particular religious sect. The issue is subtle -- it is not occasioned simply by church ownership of property or a media outlet -- rather the question arises because of the accumulation of power by the Mormon Church, and the increase of that power by actions of this Commission.

 

The media cross-ownership in Los Angeles, the concentration of control over media nationally, the accumulation of conglomerate economic and political power, combined with a practicing religious group strongly indicate to me that this application should not be approved without the fullest investigation into the present holdings of the Mormon Church.

 

I dissent.

 


Back to Top Back to Index