Profits v. Public Service

Network executives protested long & loudly that FCC's antimonopoly regulations would wreck their business. That was long before the U.S. Supreme Court gave FCC power to enforce these rules (TIME, May 24, 1943). Last fortnight FCC Chairman James Lawrence Fly issued a terse two-page report which showed that 1943 was radio's richest year. The lean, tart-tongued Chairman, blithely assuming that this war-made prosperity will be permanent, presented it as a complete refutation of the networks' squawks.

According to FCC, 796 standard broadcast stations netted $46,481,397 (before taxes) last year--a 52% increase over 1942. Only 73 stations reported losses (171 did in 1942). NBC earned 190% (before taxes) on the value of its property; CBS, 158%; the Blue Network 149% (up from 8%); Mutual, 84%.

The prime reason for radio's prosperity is the newsprint shortage, which has forced advertisers to turn to radio. This, in turn, caused Chairman Fly to ask what has become of many of radio's noncommercial public service ("sustaining") programs--symphony concerts, educational forums, town meetings, etc.

If the antimonopoly regulations were enforced, the networks said, they would have to cut down much of this free public service. FCC reported that the programs have been cut down all right, but for a different reason: local stations have dropped them like hot cakes for the hotter cake of profitable commercials. Stock network rejoinder: affiliated stations on the networks will not take the sustainers because they have to make money.

As his last word on sustaining programs, Fly quoted Harlow Shapley, Harvard astronomer, who wrote to CBS: "I wonder . . . if our national needs are being adequately served. . . . I wonder if the broadcasting companies are making important friendships among the stockholders to compensate for the friendships they are losing in the educational world."

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