Reply Brief of the Public Broadcasting Service

Home , Field Communications, RKO General

Before The COPYRIGHT ROYALTY TRIBUNAL Washington, D.C. 20036

In the Matter of Distribution of Cable Television Royalty Fees

REPLY BRIEF OF THE PUBLIC BROADCASTING SERVICE

The Public Broadcasting Service ("PBS") submits this Reply Brief in response to a statement made in the "Memo- randum of the Joint Sports Claimants" filed with the Tribunal on November 15, 1979. In that Memorandum (in a section entitled "Additional Matters" ), the joint sports claimants cursorily question whether the programming of noncommercial educational stations is "non-network" programming and therefore compensable under Section ill of the Copyright Act. There are two major reasons why the programming of noncommercial educational stations must, be considered "non-network" programming and therefore compensable under the Copyright Act. In the Act, Congress defined three separate types of broadcast. stations: a "network station;" an "independent station;" and a "noncommercial educational station." Moreover, in establishing the compulsory license scheme for secondary transmissions by cable systems, Congress separately identified the three different, stations whose signals could be retransmitted and for which signals the cable systems would contribute a "distant signal 1/ equivalent" value. Had Congress intended "network" and "noncommercial educational" stations to be synonymous, there would have been no need (1) to have provided separate definitions or (2) to assign separate values to the three different signals. The fact that the same numerical value was assigned to "network" signals and to "noncommercial educational" signals cannot negate the fact that three different signals were contemplated and accounted for by the Act itself.

A second reason why noncommercial educational programming is "non-network" programming and therefore compensable under Section 111 of the Copyright. Act is that most noncommercial educational programming is not being televised nationwide. If it is, it is only because the programming was coincidentally purchased by individual noncommercial educational stations through complicated syndication mechanisms. On the other hand, programming purchased by the ABC, CBS, and NBC networks is virtually assured of being televised nationwide on all of the purchasing network's affiliates. Consequently, there are no "unsold" markets into which a cable system would retransmit the network programming because the programming already was being broadcast nationwide

1/ "Independent" signals were assigned a value of one; "network" signals were assigned a value of one-quarter; and "noncommercial educational" signals were assigned a value of one-quarter. 17 U.S.C. 5 111. by virtue of its "network" status. For copyright purposes, therefore, Congress properly assumed that the acquisition price to the copyright owner for network programming includes compen- 2/ sation for nationwide transmission. Programming on noncommercial educational stations, however, is not assured of nationwide transmission. In the first place, the broadcast coverage of noncommercial educational 3/ stations does not encompass the entire United States. In the second place, and in contrast to the ABC, CBS, and NBC television networks, there is no single acquiring entity for noncommercial educational programming that can assure program producers that their programs will be broadcast on a nationwide system of affiliate stations. PBS functions like all other program syndicators and, through complicated syndication mechanisms, obtains programs for distribution to purchasing stations. A significant portion of the programming broadcast on noncommercial educational stations has been obtained through one such mechanism, the Station Program 4/ Cooperative ("SPC"). The SPC works in the following manner.

2/ See H.R. Rep. No. 94-1476, 94th Cong., 2d Sess. at 90 (1976). 3/ See Attachment 1 to this Reply Brief. In those areas where there are no local noncommercial educational stations, the noncommercial educational programming may be offered for- sale to local commercial stations. 4/ Another purchasing arrangement is the Station Independence Program ("SIP") in which .SIP participants collectively purchase noncommercial educational programming. As is the case with SPC- purchased programming, only purchasers obtain broadcast right to SIP programming. A program producer develops a program idea, puts together a program budget, and, in some cases, produces a "sample" program. The program proposals to be submitted for station consideration are collected in a catalog which is distributed to participating noncommercial educational stations. Each station then, in effect, votes whether it wishes to purchase the right to broadcast that 5/ program in its local service area. While some programs are purchased by a large percentage of the part'icipating stations, other programs have difficulty attracting even a minimum number of purchasing stations needed to make the program economically feasible. Some programs cannot attract enough purchasing stations and are dropped from the SPC after a specified number of "rounds" or opportunities for purchase. After the formal "rounds" of bidding under the SPC have ended, programs that have attracted a sufficient base of purchasing stations are again offered to stations that declined to purchase them during the SPC. ln markets where such programs were not, purchased by any local noncommercial educational station, or where there is no local noncommercial educational station, the programs may be offered for sale to local commercial stations.

5/ Because the noncommercial educational stations'urchasing methods are tailored to meet individual stations'eeds, it is rare that, two noncommercial educational stations'roadcast days will contain the identical mix of SPC- or SIP-purchased programming, regional programming, locally-produced programming, or programming from any other source. The same cannot be said of network stations'roadcast days. It would be a significant disincentive to purchase noncommercial educational programming in the SPC or post-SPC if the programming were going to be made available in the pro- spective buyer's service area by virtue of cable retransmission of that programming. .Compensation under the Copyright Act, then, is clearly appropriate in return for the retransmission of this syndicated noncommercial educational programming just as it is 6/ for retransmission of commercially syndicated programming. The means of distributing the programming is not dispositive of the "network" — "non-network" issue. In view of current, satellite distribution capability, television program syndicators, sports interests, independent. stations, network stations, noncommercial educational stations, and networks all 7/ have nationwide distribution capabilities. This obviously cannot mean that all the programming distributed by means of improved technology to selective purchasers becomes "network" programming by virtue of that national distribution capability of the seller.

6/ SPC or SIP programming is clearly a form of syndicated programming in that it is available for televising only by the purchasing stations. Yet commercial stations (either network stations or independent stations) can protect their purchased rights in syndicated programming by availing themselves of tKe applicable Federal Communications Commission's syndicated exclusivity rules. See 47 C.F.R. 5 76.151 et sece. But syndicated program exclusivity protection is not available to noncommercial educational stations. Reconsideration of the Cable Television Report and Order, 36 F.C.C.2d 326, 341-42 (1972). Thus, even assuming arguendo that those rules provide some protection for commercial stations, they provide none for noncommercial educational stations. 7/ See "Communications Satellites: The Birds Are In Full Flight" in Broadcasting Magazine at pages 36-47 (November 19, 1979). Attachment. 2 to this Reply Brief. In summary, given the fact that Congress treated noncommercial educational stations differently than network stations, the Tribunal should not negate Congress'ction by treating the two as the same. In view of the significantly different acquisition or purchasing mechanisms for noncommercial educational programming, the compensation intended under Section 111 of the Copyright Act for syndicated programming is clearly appropriate for noncommercial educational programming. Respectfully submitted,

Elizabeth L. Shriver General Counsel

Eric H. Smith Deputy General Counsel Of Counsel: Harry N. Plotkin Gene A. Bechtel Jacqueline Weiss Cynthia L. Hathaway Assistant General Counsel Arent, Fox, Kintner, Public Broadcasting Service Plotkin & Kahn 475 L'Enfant Plaza West, S.W. 1815 H Street, N.W. Washington, D.C. 20024 Washington, D.C. 20006 November 28, 1979 h

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Demand ls outstripping supply ss nology mean only a more economical use is nearing capacity. more snd more broedoast 848rvloes alternative to conventional means of Although RCA Americom has been the loolt to ttle sltles for ttellsllllssloll transmission, but for others satellites have satellite company of choice for the cable a much yeater imponance. opening the tele:vision industry since 1975, RCA hes Nothing has had a yeater impact on the door to a new world of services that may stayed involved with broadcasting, govcnI. transmission of radio and television sig- render obsolete some of the convemionai ment and business users of domestk nals in the United States over the last five services of today., satellites. With the launch of its third?4. years-and perhaps all electronic com- The one thing that is holding back the transponder satellite, schcduied for Dec munications-than the widespread ap- development and further proliferation of 6, RCA hopes to provide greater satellite plication of domestic, geostationary com- satellites is the technical problems that capacity for broadcasters and others. munications satellites. limit the number of satellites that can bc RCA's Satcom 1, launched in December Today there am eight of these satellites put into orbit to serve the United States. 1975, now serves the cable industry, with in orbit, with mom planned for the near Since them is a limitation imposed by the exception of few transponders used fet future. Esch is equipped with transpon- nature and pmsent technoiogy, satellite commercial message traffic. Since 1975 ders-devices that receive a signal and space is becoming scarce. the satellite has quickly filled with resale relay it back to earth and are capabie of There are currently three companies carriers and program distributors whose providing numerous video, audio and data that have launched satellites in geostation- primary purpose is to send programing ae channels to broadcasters, cablecastera. ary orbit-RCA Americom, Western a pay or advertiser-supported basis to ee telephone companies and myriad business Umon Telegraph Co. and Comsat Gener- estimated 4.5 million cable subscribers. and government users. al-and a survey of these companies and C For some the advances in satellite tech- their customers indicates that transponder The biggest user of Satcom II, launchetl

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traffic 24 15 Message Oakland, Calif. Satellite Communi- Seasonal irrvu 16 Showtime Plus Sports Shawtime cations Systems Entertainment (owned by Warner Communications) 16 Appalachian Community Appalachian 4.5 PTL 24 PTL TV Network Network Regional 24 Service wrpi tv Chicago United Video Commission Video 24 24 wrier~ Chicago United 17 waR-tv New York Eastern Microwave (sub-leased liam (failed on launch) Out Showrime) Cable 24 Star Channel Warner 12 24 Reuters News Service Reuters wrss Atlanta Southern Satellite 18 Systems (owned by Satellite GalaVision Spanish international 9 ~ Syndicated Systems) Network 12 Sat-Sun 24 (sub-leased fram UPI Newstime Southern Satellite Systems Reuters) 24 ESPN Entertainmcnt and 19 Message traffic Sports Programing 20-25 hrstwk 20 Total Communicatians TCS Network Systems CBN Satellite 24 Chnstian Broadcasting 20 Home Box Office Network Sennces (spare and in%ouse) Madison Square UA Columbia Seasonal 2 M-Sat 21 Home Theater Network Satellite Syndicated Garden Sports Satellite Sennces Systems UA Columbia 1 M-F M-Sat Calliope Satellite Program Satellite 22 Satellite Seniices 21 Sun Network Syndicated Systems 24 Thursday Night UA Columbia Seasonal 24 21 JASll. Satellite Baseball Satellite Services Syndicated Systems 7 C-SPAN C-SPAN Approx 24 M-F 21 Oisco Network Satelkte (sub-leased from Syndicated Systems UA Columbia) M-F West HBO Approx 12 ~ West Shawtrme Approx 9 22 HBO 0 Shawtime 5 Entertainment 12 Sat-Sun 22 Modem Modem Talking Service Warner Cable 13-14 Cable Programs Picture 11 Nickelodeon (sub-leased tram Approx 9 M-F 12 Shawtime East Showtime HBO) Entertamment 12 Sat-Sun 6 24 23 HBO Take 2 HBO 13 Trinity Broadcasting TBN HBO Approx 12 , 24 HBO East 14 Message traffic transponder 9. leased to UA-Co- the in 1975. services. for example, aie offered over Thc cable satellite. With Home Box Office leading way sports, Calliope. Thursday to serve ca- lumbia Cablevision-Madison Square Garden l filled with cable programers each seeking fifth wiif be ad- Satcom quickly trans- Night Baseball and C-SPAN-and. starting this January, a systeins on an advertiser-supported or pay basis. Twenty af 24 users. includ- ble teievision ded. Slack Entertainment Television. A few af the Satcom ponders on the satellite arc used for the distribution of cable Broadcasting Network. dis- subcamer usage. ing Trinity Broadcasting and the Christian programing. Through time-shanng anangementa or well to cable systems. Faut different tnbute programing to television stations as as more than ane service can be offered on one transponder.

("Closed Circuit," network also uses the satelhte are still in question in March 1976. is Alascom Inc., which ll. and thc response to filings made by 10 hours a day for news and sports Nov. 12). In serves the state of Alaska with telephone uy to Microwave and Spanish interna- Alascom feeds, as well as other types of programing. Eastern aud broadcast communications. serve tional Network's GalaVision. the FCC has fmm RCA The ability of Sarcoma I and II to .infor-. has taken aver this function business directed RCA to turn over certain Communications. which was sold braadcastiug, government and whether Alaska and video/audio ser- mation so that it can determine Pacific Power & Light Co. earlier this users with message GalaVision ta increase when Satcom III is ad- RCA discriminated against year. The majority of Alascom's satellite vices will Micmwave in the assigning of to the system. Cable programers leas- and Eastern time is used for message roll service within ded the transpondcrs. ing transponders on Satcom I am expected Alaska and to and fram the contiguous num- RCA plans ro use nine rransyondcrs on also uses a transponder to to transfer to the same transyonder -second cable states. but it will be an all~- the freed=up Sarcom I as a television daily into bers on Satcom III. which have been feed network to RCA. four trans- network." Those transponders Anchorage from an uplink outside Los ble bird. According with four of them going yonders on Satcom 1-4, 14, 15 and 19- assigned by RCA, Angeles. for cable rralfic to the Emertainmeut and Sports Program- II is also used on a regular basis nor cununtly being used Communications Satcom ro HBO, Showtime. ing Network: Total NBC-TV for feeds between New York will be assigned based in Piusburgh: by Southern Satellite Systems (for transmis- Sysrems, a new firm and Los Angeles, and on au occasional United Video, add the Satellite Com- and CSS-TV. NSC's sion of the Cable News Network) and the basis by ABC-TV Satcom Iil. munication Network. s new resale carrier, is fed ta New York fram National Christian Network on five Toaighr Show assignments of these transyondcrs based in New York. The other Burbarrk. Calif.. every evening via Satcom The

~ Her ie ters $8 and Continental regularly scheduled newscasts. custolners lined ttp by RCA have asked Fairchild Industries are rate birds in the Telephone in exchange for needed capital Wold and Hughes not to be identified. RCA said. satellite world. Although each produces I and Satcom II (BRoADCAsTtNo. Nov. 5). The balance of Satcom broadcast time some of its own programing and uses a further commercial voice The three major users of dis- will be used for (which includes all small portion of its satellite time for and data. government and broadcasting on the Westar system both resell Advanced Westar) are CBS-TV, tribution of that programing, traffic. Business users of the Satcoms for but the their satellite time as part of their Holi- Hughes Television Network and Robert most of message traffic include IBM, Exxon, com- broadcast production and transmission various insurance compa- Wold Co. Each has signed long-term day Inns, ITT, Union by which business. brokerage houses and Japanese mitments with Western business is nies and a minimum dollar Since a large portion of their trading companies. they agree to buy arises: Why aren' time each year in exchange for resale, the question RCA has developed a digital audio dis- volutne of the FCC as common car- at- hourly rates. Each has agreed to they classified by tribution system with which it hopes to lower subject to the ruies and regula- It purchase an average minimum of riers and tract radio broadcasters to the Satcoms. tions of common carriers? The answer is penetrate the broad- $950,000 worth of satellite time each year will also "attempt to exchange for not simple. The FCC permits satellite market" with its proposed SMARTS over the next three years. In don't make cast can buy time at customers to resell time if they which would utilize three trans- this commitment, they auorney said, the system, substantially cheaper than the occa- a profit, but, as one FCC ponders on Satcom II, according, to Waiter rates determination of what constitutes a ptofit of engineering for RCA sional user can. If it also promises to buy Braun, director to schedule the is not an easy one to make. According to Americom. The SMARTS plan, which five hours per day and

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Hughes next 90 days in advance. Hughes. for ex- Theodore Waddell of the FCC, RCA hopes to begin testing by early time ruling by and four only $ 107.50 for the first half filed a request for a declaratory year in cooperation with Viacom ample, pays asking simply television stations. calls hour of time and $53.75 for each succeed- the FCC in August 1977 Post-Newsweek not it is a common carrier. The to and install seven-meter ing quarter hour during prime time. This whether or for RCA supply to make that ruling. receivewniy terminals at television sta- rate is further reduced if Hughes or its FCC has yet its own earth facilities. Whether common carrier or just tions for the reception of syndicated pro- customer supplies time to bad news for these bulk users is that another satellite user with a lot of graming. The to look at the is to the cable Western Union filed tariff revisions at the resell, it is necessary What RCA Americom two companies to dis- Western Union Telegraph Co. is FCC on Oct. 5, increasing the rates for the customers of these business. the real users of Westar's satellite to the broadcasting business. bulk users as well as the occasional users. cover three FCC doesn't suspend or reject the capacity and ground station facilities. The company currently has If the estirt(ates it in orbit, each revisions by Jan. 3, 19&0, as the three have Wold resells its time-it Westar satellites (I, II. III) of TV time and 3.500 transponders. Plans cail for the all urged the FCC to do, the higher rates buys 6,000 hours with 12 radio time each year-to broad- launch of an additional satellite. Westar wil! go into effect. hours of "Ad- the Westar casters, cable operators, subscription IV, in late 1981 or early 1982 and an CBS-TV has been using as ever since the first two Westars television operators and MDS operators. vanced Westar" with 12 transponders system are broad- wide-band capacity at a were launched in 1974. The network uses Its principal clients, however. well as additional leases or buys from to fly some- the time for sports programing, news and casters. ABC-TV higher frequency, scheduled seven hours a day. Western Union has. how- occasional live broadcasts. The news use Wold six-and-a-half to time in 1983. that time to distribute its early- ever. agreed to relinquish control over a primarily entails sending taped reports It uses into Good hfoming, Amcnca, to re- good portion of its satellite rapacity to back to New York for incorporation morning ~iolilaaNNtg ~ 10 iara 43 ceive feeds from Chicago and Los Angeles 10 afffliated television stations and six pm- Mutual is installing tecei~nly earth for th" nightly news, to transmit live gram buyers. Five of the affiliates pick up stations in the top-200 radio markeis and sports events, and for other uses as needs the SIN signal through their own earth sta- expects to begin transmitting to the arise. A spokesman for ABC said that the tions and the others through land lines "dozens" it has in place by early 1980, Six network turns to Satcom I when time is linked to the five stations with earth sta- hundred and fifty Mutual earth statIoIts unavailable through WolcL tions. According to SIN's president, Rene are expected to be in service by April Although the Public Broadcasting Anseimo, because of the large amounts of 1981. System now leases four transponders time it is using, SIN would like to circum- Mutual will use six channels on Wesiaf directly from Western Union for distribu- vent Hughes and buy a full transponder I, transponder 2, when its system becotttes iion of its programing to member stations, direct from Western Union when its pres- fully operational. It is currently using only it still uses Wold services for transmission ent contract with Hughes expires. three of its channels to broadcast frutti of some sports and news events. A large portion of Hughes's business is Washington to regional offices in Dallas, UPITN uses Woid time for one link in made up of professional sporting-evem Chicago and Los Angeles. the transmission of its daily news report 'transmissions. John A. Tagliaferro of NPR is also in the pmcess of installing from New York. The report is sent fmm Hughes said that Hughes transmits earth stations at member stations nation- New York to San Francisco via Wold- hundreds of baseball, basketball and wide and plans to complete construnion Western Union and then sent back to an hockey games played on the road back to of 150 receive-oniy dishes and 17 uplinks Intelsat satellite over the Pacific Ocean and the holder of the television rights in the by May 1980. Using 2 channels on trans- picked up in Tokyo and Hong Kong. home town. For this service, earth stations ponder 2, Wester I, NPR has been Wold also provides its services to the and land lines are usually leased from transmitting since On. I to the 20 or so Entertainment and Sports Programing Western Union or other common carriers. affiliates with antennas already installed. Network, whose programing is sent out If, however, the customer has its own NPR expens to be using four channels on over Satcom I. transponder 7. ESPN earth station-as does Storer Broadcast- that transponder by Jan. 1 and has an op- transmits sporting events of the National ing-the signals are sent directly to the tion with Western Union to expand to 20 Collegiate Athletic Association to its cable Cllstofllefs. channels as needed. The NPR system will customers and uses the time bought from As a subsidiary of the newly formed allow sharing of programing generated by Wold and the necessary terrestrial lines to Madison Square Garden Communications any of its over 200 affiliates. and'ill be bring the games back to ESPN's "head Network, Hughes will be assisting in the available to any producer or distributor of end" in Bristol, Conn. production and satellite transmission of noncommercial radio programing. Another major cliem of Wold is the In- MSGCN's sports programing, which al- RKO and AP Radio have an agreement dependent Television News Association, ready includes coverage of the National In- to share earth stations and sate!lite time on the nightly news network serving 21 inde- vitationai Basketball Tournament and the Westar 1. The plan for their shared system pendent stations around the country. For television rights to the Eastern Eight col- calls for 15-foot dishes in 50 cities. APR its news feeds, ITNA buys from one-and- lege basketball league. has been testing on Westar I and has not a-half to two hours of time, Monday According to Tagliaferro, Hughes pro- announced when it will move to the through Friday, and a half hour on Satur- vides many "miscellaneous" services satellite for all its audio and data transmis- days and Sundays. Eight afFtliates of the such as the coordination of special net- sions. RKO has been broadcasting network receive the feeds via Western works, distribution of syndicated program- newscasts since Oct. I via Westar I to the Union-owned downlinks and 14 via pri- ing and closed circuit television. Examples 12 radio stations it owns, using Western vately owned downlinks. of the special networks Hughes creates are Union uplinks and downlinks. RKO hopes Woid also sells time to NBC-TV, which the annual Jerry Lewis muscular dystro- to be on satellite 24 hours a day by Feb. l. uses the satellites of its parent RCA for phy telethon and Ronald Reagan's an- 1980. and plans to have over 100 affiliates most of its occasional-use time; the Public nouncement of his candidacy for the in its radio network by the end of 1980. Service Satellite Consortium, TVS Net- Presidency last Tuesday (Nov. 13). receiving news, sports and feature pro- work, National Hockey League Network. Customers of the cfosed~itcuit services grams. All-American Network and a number of are mostly businesses. UPI plans to rely on satellite transmis- individual radio and television stations. Western Union's other major customer sion fot all its audio and data feeds and to The major television network affliiates in is the Public Broadcasiing Service. be totally ofF the ATJtT facilities it cur- Hawaii use time purchased from Woid and Through funding from the Corporation for rently uses by June 1981. The news ser- the earth station of a Wold subsidiary, Public Broadcasting, PBS became an all- vice has been testing on both Westar I and six-io- Satellink, to pick up the network feeds on satellite system in December 1978, using Satcom I, with 14 smail-aperture the mainland. Robert Panerson of Wold transponders 8, 9 and 11 on Westar L In eight-foot earth stations nationwide, and said that Wold's satellite time and services accord with the Western Union tarifF de- may use both satellites when its three- are available to "anyone who has need to signed specificaify for PBS, the system has phase plan is fully operationaL The three distribute live programing." He added that exercised an option and will put a fourth phases cail for the first satellite service to Wold is developing a teleconferencing ser- transponder into full-time service on Jan. 606 broadcasting (mostly radio) customers vice. As an example, he cited the conven- I, 1980. The PBS system includes 148 re- who receive both audio and teletype tion of the World Soybean Association in ceive-only earth stations, with the main transmissions, and later satellite hookups Atlanta last August at which, through the uplink in Bren Mar. Va.. and regional for UPI's 1.140 newspaper clients and facilities of Wold. those in attendance uplinks in Hartford, Conn.; Columbia. then 3,100 broadcasters who now receive could discuss ihe state of soybeans with S.C.; Tallahassee, Fla.; Lincoln, Neb., and only UPI newswire but, because of persons in I.ondon, Tokyo and Rio de Denver. A seventh uplink is planned for reduced costs using satellites, will also be Janeiro. the West Coast. According to James able to receive audio news. Impiementa- The Hughes Television Network offers Ragan, vice president of Western Union, tion should begin by July 1980 and UPI services similar to those of Wold. Hughes PBS is paying $800,000 per year for each hopes that all of its customers will be provides an array of technical, production, of the first three transponders and will pa'y reached by satellite by mid-1982. networking and satellite interconnection $750,000 per year for the fourth. ABC, CBS and NBC radio neiworks ail services. The satellite segment of its ser- Radio broadcasters using satellites have use the Westar birds as well as Satcont vice is made possible through its long- for the most part gone to Western Union satellites to carry feeds from and into New term arrangement with Western Union for service. The Mutual Broadcasting York. All three go through RCA for and some occasional time on the Satcom System. National Public Radio, the RKO transmissions between New York and Los thein satellite. It has one major client, the Radio Network, AP Radio. UPI Radio, the Angeles, and Western Union carries Spanish International Network. Physicians Radio Network and ABC, CBS between New York and Chicago. a SIN transmits via satellite 100 hours per and NBC radio networks are all making The Physicians Radio Network is week of Spanish-language programing to some use of the Westars. medical news and information service

~1ojdcsstintt Now 10 1070 44 Key flgLIres on the satellite landscape

merchandising and engineenng and as vice president of communications products. merchandising. broadcast ;. 4 . ,~egli-. engineenng and "C systems. commercial electronic systems and commercial communications systems. and his own account, Aoy Slice has been "in both cable and broadcasting, as president RCA is in head-tread competition with By Madison and out of the cable business" all his life. Even chief executive officer of Square Western Union for;he lucrative broadcast and Network, the cbntrac'. ior hiS father owned cable systems in Wyoming Garden Communications cable business. By secunng the and illinois. So it's no surpnse that Biiss is teiewsion arm of the Madison Square Garden Home Box Office. RCA Americom took the iead today serving the cable industry as executive Corp. in service to the cable industry. but it haS been vice president of United Video. As Cohen explains it, MSG Communications outrun in the race to win broadcast customers, Madison United Video's pnmary product is ~rv Network is actually four companies: To lure the broadcaster to the Satcoms Ingns wnich the~r ChiCagO, whiCh it diStributea tO Cabie Syeteme Square Garden Cabiewsion, packages and RCA have been busy promotmg Garden events annually SMARTS system and have presented NBC.TV over Satcom L Wee-tv, he says.hase love-hate 125 Madison Square metropolitan to the relationship with United Video. "They love the for cable systems in the New York with a proposai offering augment and network's with the power of exposure and additional viewers, but don't like area; the ioint venture of MSG Cabtevrsion terrestnai system "in satellites. the heat they get from the producer side." UA-Columbia Cablevision, whiCh transmits Bliss went to Tulsa and United Video when excess of 250" Madison Square Garden events the United States it was still a subsidiary of United Cable. He and to cable systems througnout which holds the Ed Taylor, now a competitor as head of via Satcom I; MSG Teiewsion, Southern Satellite Systems, worked together nghts to various sporting events and Hughes tnere and built a 6,000-mile microwave system. Television Network. the mufti-faceted that has a bulk Taylor went to Southern Pacific producers and satellite earner Communications Corp. when United Video time arrangement with Western Union. the various sold its voice data network to SPCC and Bliss Because of the range of services remained with Uni'.ed Video, staying on after it entitieS prOvide. COhen thinkS that hiS was sold to Lawrence Rinn in 1976, company is in a "unique position to exploit in or Tnough he representS a cOmmon carrier, any opportunity that might arise the cable "We think that our position Bliss feeis it isn't the carriers that have the television business. most to gain from the continued expansion of in the cable and teiewsion industry combines sateilite capacity and use, "The people who to make us something special," he says. will benefit most will be the software producers 0 amount of material can be ... an incredible Andrew Ingfla arnved in his position as over one satellite." transmitted president of RCA Americom in January That Satcom i is today the satellite of the cable 0 1977. To get there, he spent 24 years at RCA in industry is due in no small part to the pioneenng efforts of Home Box Office and Ten years out of the University of Pennsylvania a vanety of positions. He has served as Gerald Levin. As chief executive officer Of and just 32 years old. Joseph Cohen heads a manager of broadcast studio pianning, studio in 1975, Levin moved HBO, wnicn had diverse communications business. serving systems. closed circuit TV, broadcast HBO

World Rcport also has full-time access to Continental Telephone of Atlanta agreed ttansmincd over Wester out of Ncw York joint FM radio stations, three voice-grade channels on Wcstat. It' to operate American Satellite as a to 23 widely dispersed Fairchiid and it out over subcamcrs. using its time to send data to remote print- venture. and last month which send insure the future of Western Union, like Hughes and Wold. ing plants in Los Angeles. Old Saybtook, Continental helped Satellite buying a 20% share own miscellany of customers. They Conn.. and Chicago. lyte Wall Street Jour. American by has its (Wcstat I, II, III and include the Satellite Business Systems. rtal also uses the Westar system for of the Wester system transmission of high-speed data used in IV) and a 5P%%d share of the Advanced which is testing some of its facilities in an- leases own satellites for printing the daily business paper. The Wcstat. American Satellite already ticipation of launching its time on transpon- the transmission of digital data informa- Journal, however, buys its time through substantial amounts of 7 Wcstar which it uses to tion; the Public Service Satellite Consor- thc American Satellite Corp. dcrs 3, 5 and of I, The American Satellite Corp., German- provide voice, data, facsimile attd other tium, provider of tcleconfctcncing and the service for distributor of health and educational pro- town, Md., is the only large business com- wide-band communication munications customer of Western Union. primarily business applications. graming for its membership, and several Western and if a couple of dcais made this fail gct On the drawing board for publishing concerns. with Westinghouse Time magazine is currently using the stamp of approval from the FCC, it will Union are agreements Wcstcrit Union's Broadcasting, Video Communications Inc. satellite space on Wester II six or seven become a par1 owner of an- satellite operations, entitled to a substan- and Muzak. Under an agreement days a week. four or five hours a day for Iuiy ttansmissions from New tial portion of the precious satellite time. nounced last July (BRoADchsTTNG, data facsimile Westinghouse and Wasteth Union will York to Los Angeles. UM Blue and Last August, Faitchild Industries and 30)

enicccasllny Nov re 'i $70 46 I to into the subscription television miCrewave ending his 15-year stint there with a job plans get been serving cable systems via He said the company aiready has the description that sounds like a perfect business. since 1972, to satellite and answered awarded a construction permit for a UHF ot that preparation for hia present employ; "future been ChiCken or the egg" question. As a result Ann and there are three business planning for the spacecraft station in Arbor, Mich. move. cable systems installed earth stations pendlnq. time. department." He has also had a taste of more and programers lined up to buy satellite Taylor's background includes work at ATLT, of problems at the other end of satellite Today Lewn is a group vice president Video (wnile it was still a subsidiary of transmission. He operated cable systems for United Time-Life. responsible ior four other United Cable) and Western Onion. Cable. American Gulf Z Western and TCI. operations-Manhattan that Communications Corp„wotvirvi Besides the programing opportunities Telewsion Z other Rapids. Mich„and Time-Ufe Films-as satellites make possible there is one Grand broadcasting well as HBQ. thinq that he feels cable and And Levin has no iritentiorl of restin9 on his companies should be grateful for- competitive laurels-one of which is the 1979 Beisswenger competition. "This is a highly into the cable side of the Nationai Cable Television business. We want to get Award broadcasting." The Association. Me are not only interested in and RCA wants to get into competition can only be the putting up payable service, but also services winner of such for basic cable," l.evin said. He said that consumers, he said. programinq for such an advertising-supported service would probably come from the Time- Lite Films division. o

Levin joined HBQ in 1972 as vice president New of programing after several years with a 'p~'.

firm and an international management

York law dG~ and consulting firm. Robert Wold, president and owner of the

'.'a of the same name. is a program t'A company packager. Throuqh his company's bulk-time r arrangement with Western Union, Wold takes the programing of its clients, set up land and i'n 0 satellite connections and delivers it wherever itS Clients wish. Wold's pnncipal satellite networking rival is the Huqnes Television Network, which Ied the in specialized TV interrections (on a 1976 when the long arm of the FCC way terrestrial basis) before Woid expanded his threatened to come down on Ted Turner and own business skyward wnen satellites became hiS Plans to be both broadcaster and common available. Both companies are now about even earner by putting his wrcoirvl Atlanta (now in terms of annual transponder hours. wras) on a sateliite for cable distribution, with the firat Satellite sold the earner company, Southern Wold is credited Turner commercial proqram-a Satellite Systems, to Kd Taylor for Sl. Taylor. broadcast of a live between the Milwaukee operating as a commonwarrier mdependent of baseball game James Regan, vice president of broadcasting the Texas Rangers on Aug. 9. Turner. camed out Turner's plans and made the Brewers and services for Western Union. sees satellites as a has opened a door on a UHF into a superstation." 1975. That telecast programing tool. "if you look at satellites as lust lowly broadcasting services that have yet But Taylor didn't stop tnere. Acquinng plethora of an economic alternative, you miss tne or-it can be said-imagined. another full transponder on Satcom I, Taylor to be counted significance of satellites to the broadcasting himself the rudiments of started the Satellite Proqrarn Network. which Wold taught Cqmmunity," he SayS. "The Creative peOple are when. salesman at wrier~i offers advertiser-supported programing to programing as a no longer bound by a distnbution system." fifties, he put together SyatemS: added the Slaw-SCan UPI newS Chicago in the early Ragan haS been in his present position sinCe Cable clients and as an to the subcarner of the superstation proqraming for hiS 1976 when the satellite business as a whale service when he set up transm~ssio: and will begin carnage of advertising executive later on, began prowng itself as an economical and stations in six states to another of Turner's projects. the cable News a network of 40 radio reliable means of deiivenng cable and of tne Min- summer it ail goes according to broadcast the baseball games broadcast signals. Network. next plans. According to Taylor, his company also nesota Twins. He began his career with General Bectric.

re- restricted ATILT's and GTE's use of the Union's ground facilities as sion services. Muzak will install 500 share Western earth stations so that its Comstars was lifted, the two companies weil as Westinghouse-built earth stations ceive-only broadcast ser- can receive the music via Westar were free to offer further in Washington and Los Ange)as. franchise satellites (BRoADcAsTINo. to directly from its New York production fa- vices on the Westinghouse plans to use the system July 30.) The teiephone companies have among its various cilities. exchange programs is also in the yet to indicate their pians for future uses television stations as we/l as satellite dis- Comsat General Corp. domestic sateiiite business with its three of the Comstars. tribution of other stations of syndicated Comsat has announced plans for direct its Group W Pft)- Comstars, which are leased to ATILT. programs pmduced by the satellites for sateliite-to-home pay television services Video Communications. Tulsa, AT(kT curretttjy uses ductions. and government private line for possible introduction by 1983 i BaoAD- Okla., signed a deal to send movies, news telephone would in- services. GTE Sateilite Corp. also leases cAsTINo, Aug. 6). The system and sports, and other entertainment pro- satellites and small, inex- space on the Comstars through ATSrT to voive three new graming to industriai personnel in remote mof-top receiving antennas. Com- Video pravide message toil, government and pensive and isolated areas of the world. At sat envisions providing programing, free transmit 12 hours a business communications channeis. Communications will broadcasting service of commercial interruption. that cauld in its initial service and increase that present the oniy educa- day AT8tT and GTE on the Com- consist of movies, sports events. number to 24 by the ehd of 1980. Western offered by material, data and text con- stars is the transmission of network televi- tionai and cuiturai Union has been given a $2.8-miilion for a monthly fee to subscri- New York sion programs to Hawaii. As of last July transmission tract to provide Muzak, the moratorium that bers. music pmgramer. with sateiiite transmis- 23, when an FCC aroeocsttao see is ieze 47 CERTIFICATE OF SERVICE

I, Carol A. Moore, a secretary in the law firm of Arent, Fox, Kintner, Plotkin s Kahn, do hereby certify that I have, this 28th day of November, 1979, sent copies of the foregoing "Reply Brief of the Public Broadcasting Service" by first class United States mail, postage prepaid, to the parties on the attached list.

Carol A. Moore Arthur Scheiner, Esquire Richard H. Naysdorf, Esquire Robert F. Corazzini, Esquire Nilner & Scheiner Peter H. Feinberg, Esquire 2021 L Street, N.W. 1776 K Street, N.N. Washington, D.C. 20036 Washington, D.C. 20006 Counsel for MPAA, Inc. Counsel for Superstation, Znc. Fritz E. Attaway, Esquire R. David Bustard, Esquire Motion Picture Association 1440 Broadway of America, Inc. New York, N.Y. 1001S 1600 Eye Street, N.W. Counsel for RKO General, Znc. Washington, D.C. 20006 Howard M. Weiss, Esquire Jon A. Baumgarten, Esquire 1000 Connecticut, Ave. N.W. 10th Fl. Paskus, Gordon & Hyman Washington, D.C. 20036 1919 Pennsylvania Ave., N.N. Counsel fox WPOW, Inc. Nashington, D.C. 20006 Channel Nine of Orlando Northland, TV, Inc. Albext P. Ciancimino, Esquix'e Eastern Maine B/Cng. System 10 Columbus Cix'cle New Yox'k, N.Y. 10019 Eleanor D. O'Hara, Esquire Counsel fax'ESAC, Xnc ~ 30 Rockefeller Plaza New York., N. Y. 10020 Bernard Karman, Esquire Counsel fox NBC, Inc. One Lincoln Plaza New Yox'k, N.Y. 10023 Richaxd, G. Gxeen, Esquix'e Counsel fax'SCAP 1270 Avenue of the Amex'icas New'ork, N.Y. 10020 J. F. D'Angelo, Esquire Counsel for Peekskill Enterprises 234 East 45th Street New York, N.Y. 10017 Max'k DE Rath'squir'e Counsel fox Hearst Corp. 1330 Avenue of the Amexicas King Peatuxes Syndicate Div. New Yox'k, N.Y. 10019 Jerome E. Weinstein, Esquixe Harry P. Warner, Esquire 9401 Wilshire Boulevard 1900 Av'enue of the Stars - Ste 2440 Beverly Hills, Calif. 90212 Los Angeles, Calif. 90067 Counsel fox Heritage Enter- Counsel fox All Pxo B/Cng. prises, Xnc., Rosamond Pro- APB Enterprises, Inc. ductions, Znc., TCA TV Corp., Dimension Pictures, Znc. Dennis S. Townley, Esquire 1730 Pennsylvania Ave. N.W. Arthur J. Levine, Esquire Washington, D.C. 20006 1920 L Street, N.W. Counsel for WHAS, Inc. Washington, D.C. 20036 Field Communications Corp. Counsel for Henson Assocs. Znc. Muppets, Znc. Thomas J. Dougherty, Esquire Children's TV Workshop Preston R. Padden, Esquire 5151 Wisconsin Avenue, N.W. Harry Olsson, Jr., Esquire Washington, D.C. 20016 515 52nd Street Counsel for Metromedia, Znc. New York, N.Y. 10019 Counsel for CBS, Inc. Dow, Lohnes 6 Albertson Russell E. Arkin, Esquire 1225 Connecticut Avenue, N.W. 1325 - 18th Street, N.W. - Ste 206 Washington, D.C. 20036 Washington, D.C. 20036 Counsel for Sierra Cascade Counsel for Maryland Center Communications, Znc. et al. for Public Broadcasting Jeffrey D. Southmayd, Esquire Robert N. Gold, Esquire 1100 Connecticut Avenue, N.W. 356 West 58th Street Washington, D.C. 20036 New York, N.Y. 10019 Counsel for Christian B/Cng. Counsel for Educational B/Cng. Network, Znc. et al. Corporation Ramsey L. Woodworth, Esquire Mary M.D. Cheever, Esquire 1211 Connecticut Avenue, N.W. 4802 Fifth Avenue Washington, D.C. 20036 Pittsburgh, Pa. 15213 Counsel for westinghouse B/Cng Counsel fox'etx'opolitan Company, Xnc. Pittsburgh Public B/Cng. Xnc. James A. Koex'nex'„ Esquix'e Linda A. Landx'eau, Esquire 54 Denver Technological Center 10880 Wilshire Boulevax'd Call Box 22599 Suite 1900 Wellshixe Station Los Angeles, Calif. 90024 Denver, Colorado 80222 Counsel for Mildx'ed Kritt Counsel fox TCX Pxograms, Xn@. Robex't D. Hoemeke, Esquix'e Victor E. Fex'rail, Jr., Esquire One Mercantile Center Linda K. Smith, Esquixe St. Louis, Missouri 63101 1100 Connecticut Avenue, N.W. Counsel for KSD/KSD-TV Washington, D.C. 20036 Counsel fox WBNS-TV, Inc. E. William Henry, Esquire et. al ~ 1700 Pennsylvania Ave. N.W. Washington, D.C. 20006 Maxk J. Taubex', Esquixe Counsel fox Worldvision 1200 - 18th Street, N.W. Entex'px'isesg Ines Washington, D.C. 20036 Counsel fax'anhattan Cable Edwaxd, Schox, Esquixe Television, Inc. et al. 747 Third Avenue New York, N.Y. 10017 Erwin G. Krasnow, Esquire Counsel for Meredith Corp. 1771 N Street, N.W. Washington, D.C. 20036 Thomas J. Keller, Esquire Counsel for National Assoc. 1660 L Street, N.W. - Ste 1000 of Broadcasters Washington, D.C. 20036 Counsel for First Charleston Barbara M. Mack, Esquire Corp. et al. P. O. Box 957 Des Moines, Zowa 50304 Howard M. Liberman, Esquire Counsel for Des Moines 1333 New Hampshire Avenue, N.W. Register and Tribune Washington, D.C. 20036 Counsel for Jack Barry Productions, Inc. et al. Peter Gutmann, Esquire Haldon R. Harrison, Esquire 1990 M Street, N.W. - Ste 600 450 N. Roxbury Drive Washington, D.C. 20036 Beverly Hills, Calif. 90210 Counsel for KSWO TV Co. Counsel for Lone Ranger TV, Znc. Panhandle Telec. Co. Lassie Television, Znc. Alfred C. Cordon, Esquire Joseph F. Coyne, Esquire 2077 Elmwood Avenue 11 South La Salle Street Buffalo, New York 14206 Chicago, Illinois 60603 Counsel for Buffalo B/Cng. Counsel for WGN Continental KSLA-TV B/Cng. Co. and WGN of Colorado, Inc. Herbert M. Schulkind, Esquire Harry G. Sells, Esquire Peter Shuebruk, Esquire 2000 L Street, N.W. 1211 Connecticut Ave. N.W. Washington, D.C. 20036 Washington, D.C. 20036 Counsel for T/R, Znc. Counsel for Great Lakes Com- Southeastern Ohio TV System munications, Znc. et al. Philip R. Hochberg, Esquire David G. Rozelle, Esquire 1747 Pennsylvania Ave. N.W. 1225 Connecticut, Avenue, N.W. Washington, D.C. 20006 Suite 400 Counsel for Major League Baseball Washington, D.C. 20036 National Basketball Association Counsel for Capitol B/Cng. National Hockey League Services King B/Cng. Company North American Soccer League Zan D. Volner, Esquire James F. Fitzpatrick, Esquire 1333 New Hampshire Avenue, N.W. 1229 - 19th Street, N.W. Washington, D.C. 20036 Washington, D.C. 20036 Counsel for KAKE-TV and Counsel for Major League Baseball Radio, Inc. Ritchie T. Thomas, Esquire William M. Dixon, Esquire 21 Dupont Circle, N.W. 3415 University Blvd. Washington, D.C. 20036 St. Paul, Minnesota 55114 Counsel for National Collegiate Counsel for Hubbard B/Cng. Athletic Association Robert W. Gillis, Esquire 485 Madison Avenue New York, N.Y. 10022 Counsel for Capital Cities Communications, Znc. Cathy R. Mendelson, Esquire 5858 Sunset Blvd. Los Angeles, Calif. 90028 Counsel for Golden West Broadcasters