In the Matter of REQUEST OF AMERICAN BROADCASTING COS., INC. (ABC) FOR WAIVER OF THE "PRIME TIME ACCESS RULE" (SECTION 73.658(k)) TO PERMIT 3 1/2 HOURS OF SUMMER OLYMPIC COVERAGE (AUGUST 28-SEPTEMBER 8, 1972)
FEDERAL COMMUNICATIONS COMMISSION
35 F.C.C.2d 320
RELEASE-NUMBER: FCC 72-440
June 5, 1972 Released
Adopted May 17, 1972
BY THE COMMISSION: COMMISSIONERS BURCH, CHAIRMAN; REID AND WILEY DISSENTING AND ISSUING STATEMENTS; COMMISSIONER JOHNSON ISSUING A SEPARATE STATEMENT.
1. The Commission here considers a "Request for Waiver of Prime Time Access Rule" filed on March 22, 1972, by American Broadcasting Companies, Inc. (ABC), asking for waiver of that rule (Section 73.658(k)), to permit ABC to present 3 1/2 hours of Olympic coverage on 10 week nights, Monday-Friday, August 28-September 1, and September 4-September 8, 1972. Very little of this coverage will be "live", since Munich, Germany, the site of the 1972 summer Olympics, is some hours ahead of New York; rather, the material will be filmed and edited coverage of events there earlier the same day, selected from the large number of hours of competition in various events which will take place each day (from 69 to 106 hours daily). ABC proposes to televise, in addition, some events of each of the other 6 days of the Olympic schedule, for a total of 66 1/2 hours of Olympic coverage, including 47 prime hours.
2. Earlier requests by ABC in this connection, and by NBC in connection with last February's winter Olympier from Japan, were denied on October 6, 1971, chiefly on the ground that the requests were too general, seeking simply a blanket waiver of the rule for the dates involved. n1 NBC did not again seek waiver, but included fairly extensive coverage of the winter Olympics within its regular broadcast schedule. ABC has now made its request more specific, as indicated. In support thereof, it urges: (1) the international importance of the Olympics, and their recognized contribution to international harmony; (2) the high degree of public interest in this coverage, as shown by ABC's widely acclaimed and highly popular coverage of the 1968 Mexico City games, to the extent of 44 hours (described by critics as "the most complex and extensive television undertaking in history" and "a virtuoso display of television resourcefulness and artistry"); (3) the fact that its bidding for the right to this material, and arrangements with advertisers involved, took place well before the decision to adopt the rule, and the arrangements were based on 3 1/2 hours of prime time coverage (the contract with the Organizing Committee was publicly announced April 1, 1969); (4) the relative undesirability of an 8-11:30 (E.T.) schedule, which would be less attractive from the standpoint of exposure to young viewers who should have an opportunity to watch these important sports events, and disruption to long-established 11 p.m. news broadcasts on the affiliated stations involved; (5) the fact that the rule is not yet in full effect anyhow, and will not be until October 1, 1972, as we have recognized; (6) the additional fact that at this particular time of the broadcast year, most regular programming is repeats of series so that the loss of really new regular material would be minimal; and (7) the uniqueness of this material, constituting a "transcendent public interest consideration."
n1 See FCC 71-1037, 32 FCC 2d 58.
DISCUSSION AND CONCLUSIONS
3. This request by ABC presents a fairly close question. In support of it are the various arguments noted above, including particularly the distinctive character, merit and popularity of the material (as of similar material in 1968); the fact that the rule is not yet in full effect, anyhow, until October 1, 1972; and the fact that at this time in the broadcast year, a great deal of material is repeats of material run earlier in the season. On the other hand, it is obvious that this would amount to an expansion of network control of prime time, to the exclusion of non-network material, well beyond anything we have had occasion to consider in the past several months, and certainly far beyond anything we have permitted by granting waiver. It is also obvious that carriage of 3 1/2 hours of this material in prime time on 10 evenings is not essential to the presentation of it, for a number of reasons. First, no amount of coverage is going to mean complete presentation of all of the Olympic events, which is impossible; rather, ABC contemplates an editing and selection process. Second, since very little of the material, if any, will be "live", a recorded broadcast will take place in any event, and this is not necessarily geared to any particular time of day. Third, with three hours being permissible and planned anyhow, it does not appear that the public will lose a great deal if waiver is not granted. Fourth, assuming more time is believed desirable, there appears no basic reason why the material could not be presented at 11 p.m. E.T. and P.T. (10 p.m. C.T.) or even a half-hour later.
4. On balance, we believe that the rule must be adhered to in this situation, and ABC's request denied. While we recognize the limitations on the significance of the impingement which would occur, because of the time of year involved and the fact that the rule is not in full effect anyhow, this is simply more of a network incursion into prime time, and expansion of network control over valuable evening time which the rule is designed to lessen, than should be contemplated even under those circumstances. Permitting it would be to thwart the objectives of the rule, beyond what we believe is appropriate for serious consideration at this point. We reach this conclusion with respect to the ABC request by itself; but also, of course, we would have to deal in at least somewhat equitable fashion with other requests by the other networks should they choose to advance them, even after the October 1 date. n2 Therefore, we conclude that the request must be denied.
n2 We cannot attach substantial importance here to ABC's argument that it made its arrangements, calling for 3 1/2 hours, well before the prime time access rule was adopted. This is a private, not a public-interest, argument; and, in any event, restrictions on network programming during prime time were proposed in 1965 and under consideration thereafter, and the specific three-hour limitation later adopted was proposed in 1968. Thus, ABC was, or at least should have been, aware of potential restrictions.
5. In view of the foregoing, IT IS ORDERED, That the "Request for Waiver of Prime Time Access Rule", filed by the American Broadcasting Companies, Inc., on March 22, 1972, IS DENIED.
FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.
DISSENTBY: BURCH; REID; WILEY; JOHNSON
DISSENTING STATEMENT OF CHAIRMAN BURCH
I opposed the prime-time access rule from the start. I did so not because of any quarrel with its objective -- to provide non-network programming sources with a few more hours each week to market their product -- but rather because I felt that it wouldn't work. At the same time, I have consistently maintained that as long as the rule is on the books it should be given a fair shake; waiving it to death is no reasonable test of its efficacy.
In the present case, however, I believe we are witnessing regulation gone mad -- literal application of the rule simply for the sake of literal application. During late August, as ABC has pointed out, prime time hours will be filled with repeats and "reruns of reruns". There is also the element that ABC intended to devote all of its prime time broadcasting to Olympic coverage -- unlike previous cases where the networks sought to pre-empt regular programming for "specials" and then expand prime time on the same or some other evening to accommodate the regular programming as well.
Over the past year, the Commission has repeatedly waived and bent the rule for such "public interest" offerings as the Academy Awards, Miss America, Cinderella and overruns of live sports events (in some of which actions I must admit I joined). Yet, in this instance, the rule must be preserved -- despite the fact that the Olympic Games are indeed something "special" and the focus, for just a couple of weeks every four years, of worldwide attention. The Games are particularly the focus of young people whose parents will doubtless be underwhelmed by the Commission's reasoning that ABC, after all, can run the additional half-hour each evening after 11 p.m. or even later.
For no discernible public interest reason, and surely for no reason having anything to do with the stated purpose of the prime time access rule itself, the Commission has thus decided to deny tens of millions of American viewers several hours of Olympic coverage during the shank of the summer evening -- and the fact that most of this coverage will necessarily be taped because of time differences strikes me as wholly beside the point.
What is the point is that, for the sake of a rule that most of them have never heard of in the first place and could care less about, these millions will get less Olympic coverage and more "reruns of reruns". Stated in such bald terms -- bald and accurate -- I have no doubt where their choice would fall. I also don't doubt that the Commission's action to deny ABC's waiver request will be greeted with outrage. And it should be.
DISSENTING STATEMENT OF COMMISSIONERS REID AND WILEY
We join in Chairman Burch's dissenting statement as it pertains to the particular waiver request in question.
I have consistently maintained that as long as the [Prime Time Access] rule is on the books it should be given a fair shake; waiving it to death is no reasonable test of its efficacy.
Dissenting Opinion of Chairman Dean Burch.
I am in wholehearted agreement with the Chairman. The Prime Time Access Rule "should be given a fair shake;" we should not "waive it to death."
The Prime Time Access Rule was an experiment by the FCC with the radical doctrine of free private enterprise. The prime time television programming available to the American people is almost exclusively controlled by three firms -- ABC, CBS, and NBC -- an oligopoly notoriously committed to stagnant and cowering imitation rather than stimulating and competitive innovation.
The stations which they own (not counting their affiliates) constitute 2% of the nation's commercial television stations -- but earn 50% of the industry's gross revenues. The networks also own the property rights in the programs, the studios, many of the stars, the affiliation contracts, and the contract with ATT (which distributes the programs). They sell the rerun rights to their programs, and push them (at artificially reduced prices) onto the television systems of other nations around the world (except for those that, fearing the social impact of American TV program fare repeatedly reported by our Presidential commissions, have limited or banned American television entirely).
The U.S. Department of Justice, viewing this anticompetitive restraint on trade, has recently filed antitrust cases -- U.S. v. Nat'l. Broadcasting Co., C-72-819; U.S. v. Columbia Broadcasting System, C-72-820; U.S. v. American Broadcasting Co., C-72-821 (C.D. Cal., filed April 14, 1972) -- to bring the industry more closely into compliance with the standards long-applied to the motion picture industry. See United States v. Paramount Pictures, Inc., 334 U.S. 131 (1947).
The FCC did not go nearly so far. It took a very short, small step indeed. ("A giant leap for the FCC, but a small step for mankind.") All it said was that the networks could only program three hours (one half hour less than before) between 7:00 p.m. and 11:00 p.m. ("prime time"). This was designed to give "access" to prime time for independent producers not owned by the networks, and thus the short-hand name with which the rule was christened, "The Prime Time Access Rule." (The networks, ever anxious to avoid competition, have asked that we -- the FCC and the industry -- agree on which three hours are involved. In a letter to the networks, the Commission supported the selection of the 8:00 p.m. to 11:00 p.m. period in order that the three networks might compete equally under the new Rule. 21 P & F Radio Reg. 1586 (March 12, 1971).)
No one urged independent producers or local stations would produce "better" programming under the Rule -- only that there would be more competition, and presumably more diversity in the available programming. In spite of enormous hurdles the FCC and networks have placed in its path, the Rule appears to be slowly working its way toward its intended goal.
From the beginning, the Rule's detractors said it wouldn't work. They said program quality would go down and that there simply wasn't enough capital or expertise to support the independent programming we sought. They proved wrong on the second point; but had the power to bring about the first on their own.
At the insistence of the broadcast industry, and because we adopted the Rule too late to insure new production for the 1971-72 season, we stayed for one year the provision of the Rule that prohibited filling the newly cleared one-half hour with off-network syndicated series programs.
Thus began a run for the garbage. Nearly every local affiliate, rather than try innovative programming, used series reruns.
And, of course, the networks continued to oppose the Rule in the Commission -- citing their crummy programming as further evidence of the Rule's failure.
Time after time, as the Chairman points out, the networks have sought waivers for "specials" like Miss America and movie overruns, usually arguing that failure to grant the waiver would deprive the viewing public of the benefits of these specials when they -- and we -- knew perfectly well that if we denied the waiver request the specials could still be shown. Some other network program could easily be limited or cut to keep the programming within the permissible three hours nightly. It was their choice.
Finally, as it promised it would, NBC petitioned the Commission to revoke the Rule.
In the meantime, until the Commission chooses to revoke the Rule, it is in full force and effect.
And it is within that historical framework that the Commission's four to three decision to deny the waiver must be viewed.
The Chairman is correct: in order to test the Rule, we have to stop "waiving it to death." And finally, in this decision, we have stopped. The fact that August Prime Time hours will be filled with "reruns of reruns" will not be affected by waiving the Rule and is no excuse for doing so. A justification for reviewing the programming standards of licensees, perhaps, but not for waiving the Rule.
In effect, our action in this case can be viewed as a signal to the broadcast industry: we will not retreat from our Rule. If you want to abuse it and provide low quality programming, so be it. But that is your choice. We intend to stand by the Prime Time Access Rule.
Because ABC and the FCC minority are not above suggesting to American sports fans that an inexplicable, rigid, bureaucratic FCC is what's keeping the Olympics from their home screens, a few facts are in order.
(1) ABC never did plan live coverage of the Olympics.
(2) ABC never did plan total taped coverage of the Olympics.
(3) ABC planned to edit from (probably) dozens of hours of Olympic events per day a 3 or 3 1/2 hour excerpt (including commercials).
(4) Thus, the issue is -- at most -- whether ABC's edited tape will run 3 or 3 1/2 hours per night.
(5) When ABC bought the rights to the Olympics it was fully aware of the Rule -- first proposed in 1959. It bought the rights knowing full well that 3 1/2 hours in Prime Time would be prohibited. One network official told a Commissioner that it bought it anticipating an FCC waiver! Can you imagine a judge's reaction to a convicted criminal's statement that he committed the crime "anticipating leniency"?
(6) In fact, nothing the FCC has done today prevents ABC from showing 3 1/2 hours of edited Olympics videotape -- or videotaped complete coverage -- if it chooses. It can run its videotape from 8:00 p.m. to 11:30 p.m. (EDT; 7:00 to 10:30 CDT) -- or from 8:00 p.m. to 2:00 a.m. if it wishes. It can run it during the day. It could put on two hours of coverage from 5:00 to 7:00 p.m. -- to cover that children's audience for which ABC now argues the 7:30 to 8:00 p.m. coverage was intended -- and three hours from 8:00 to 11:00 p.m., for a total of five hours a day. If there is enough material, it can broadcast 23 hours of Olympics daily. In short, its programming options are almost endless -- with the only exception the 7:00 to 8:00 p.m. time slot.
(7) ABC will, probably, have a very profitable block buster on its hands under the FCC's ruling today -- in terms of ratings and advertising revenue.
(8) If ABC could start its program at 7:30 it could make even more advertising revenue from the 7:30 to 8:00 p.m. time slot than from the 11:00 to 11:30 p.m. time slot -- an understandable corporate desire, but scarcely grounds for waiving a Rule promulgated to serve the public interest.
(9) Having tasted blood, it wants to drive home its rating victory over CBS and NBC by getting a half-hour lead at the starting line -- beginning at 7:30 p.m., when its competitors do not begin until 8:00 p.m. Such behavior would scarcely be tolerated by sports fans in an Olympics race, and I don't think it should be accepted by them in a ratings race either.
ABC has said publicly that it will lobby the Commission to get it to reconsider its decision. Indeed, that lobbying has already begun. I received a phone call from the president of ABC, as did the other Commissioners. I expect to receive literally hundreds of letters, phone calls and telegrams urging reconsideration. If the Commission changes its mind, however, it will be because of pressure, and pressure alone.
The public may, as the Chairman has said, be outraged. But if they are permitted by the mass media to become informed, it will not be at the Commission's decision. For that decision is based on a policy markedly in the public interest. If they are outraged, it will be at a network that values profits more than public service and law and order.
How much videotape of Olympics events ABC will show us is wholly up to the network. It promises to be an interesting program, and I suspect I'll be watching.