Evening star., 1938-11-04
Transfer Of -Four
Radio Stations Is
Denied .byF. {. {.
Decision VirtuoIIy Puts
Common Carrier Label
On Broodcusting
BY WILLIAM J. WHEATLEY,

BY WILLIAM J. WHEATLEY.
Virtually placing q common car
rier label on radio broadcasting, the
Federal Communications Commis-
sion has denied an application for
transfer of Station VITO and three
other stations owned by a subsidiary
Of the Travellers Insurance Co. to
another subsidiary OF the same cor
poration.
1t was a 4-to-2 decision, with one
commissioner not participating.
There were two dissents, one that Of
Commissioner T. A. M. Craven, ac-
companied by an opinion taking
issue with the majority conclusion.
A dissent was noted by Col. Thad H.
Brown.
The action is regarded as prece-
dent-making and serves to show the
wide differences existing in the COM
mission over the formation of poll
| cies as a guide to radio stations In
promoting the comparatively new
broadcasting phase of communica-
tions.
Transfer Requested.
The application sought authority
to transfer the licenses of the stations
from the Travellers Broadcasting
Service Corp. to the Travellers Broad
casting Co., both owned by the in
Surance company. The point which
appeared to be the greatest obstacle
to approval, in the opinion of the
majority, was the assumption by the
new company of note for 81, SOC, 900
which included losses incurred by
the present operators during the
period since the station has been in
existence.
The majority opinion pointed out
that in such transfers the commits
sion must in each instance deter
mine primarily whether or not q
grant thereof would serve public
interest, but it is not bound by strict
principles of accounting such as
would be applicable in rate-making
proceedings governing common car
riers."
Court Opinions Cited.
The opinion then cited number
OF court opinions, dealing entirely
with public utilities, and commented
that it is well settled that past losses
in operation may not be capitalized
in the valuation of property for
rate-making purposes. The COM
mission then called attention to the
provision in the act which holds
that radio broadcast media are not
common carriers, but adds that the
principle expressed in the decisions
lis one which the commission rec
!ognizes to be in accordance with
sound public policy"
Commissioner Craven, in dissent
ing, pointed out that the matter of
price considered in excess of the
tangible property value has been re-
peatedly before the commission
during the past two years.
1T is regrettable," he said, that
the commission has not yet found
1t possible to adopt policy which
it can uniformly apply and to which
parties may look for guidance for
entering upon such transactions.
''' And the commissions policy
on this subject will have lot to do
with attracting or driving away
capital and the pioneering spirit
in the various fields of radio COM
munication.
Policy Seems Illogical.
Dealing with the public utility
phase, Commissioner Craven said
Congress, when specifying in 1894
that broadcasting was not a COM
mon carrier service, recognized that
broadcasting was in the stages of
early development, not only from a
scientific standpoint but also from
an ALLEGATION and service stand
point. He added that the time has
not yet arrived where the develop
ment Of broadcasting justifies the
application of common carrier doc
trines OF rate regulation either by
inference or by direct action.
Furthermore, he continued. such
a policy appears to be illogical be-
cause the situation in broadcastinp
differs so greatly from the situation
OF common carriers that the same
principles of regulation could not
be applied with a logical expectancy
OF successful operation of the broad
casting service.