Broadcasting: outline Radio and Television history Broadcasting policy: 1) Spectrum –Roots of goverment intervention –Alternatives and trade-offs 2) Ownership concentration Cable's rise

Broadcasting history (Radio) 1881: The "musical telephone" was a major attraction at the International Electrical Exhibition in Paris. The Compagnie du Théatrophone, was established in Paris, distributing music by telephone from various theatres to special coin-operated telephones installed in hotels, cafés etc., and to domestic subscribers. The service continued until Guglielmo Marconi sends a radio signal more than a mile. 1919: Radio Corporation of America formed Pooled patents (Westinghouse, ATT, GE) 1920: first US Commercial radio broadcast No restrictions on who can broadcast 1926: RCA forms NBC to encourage receiver sales (later forced to divest "Blue Network", which became ABC) 1927: CBS formed 1927 Radio Act: Licensing

Broadcasting History (TV) 1930s: experiments with "radio with pictures" RCA 1940: National TV System Committee (NTSC) 1946: TV service starts in US 12 VHF channels licensed initially 1950s: TV overtakes radio 1952: channel expansion – additional 70 UHF channels (less desirable) 1953: Color TV 1980: 83% of households have color TVs Since 1990: 98% of households have TVs, cable passes 90% of US homes

Ownership concentration rules Radio station ownership limits –1940s: 7 AM and 7 FM stations –1985: 12 AM and 12 FM stations –1992: 18 AM and 18 FM –1994: 20 AM & 20 FM stations –1996: nationwide ownership limits for radio stations eliminated. TV station ownership limits –1940s: 3 stations –1953: 5 stations –1984: 12 stations, max. reach of 25% –1996: any number, max. reach of 35% Cross-ownership rules –1975 ban of newspaper-broadcast cross-ownership –Limits on number of broadcast station in single market

1920's radio policy debate Fundamental tension: press freedom vs scarce spectrum Alternatives debated? Relative merits? Market for spectrum –Why not initially? –Primary vs secondary market

Spectrum and licenses Channels: artificial structure on ethereal resource AM radio: 10 kHz / channel FM radio: 200 kHz / channel TV: 6 MHz / channel Spectrum scarcity leads to government allocation of licenses Who gets licenses? Typically powerful players - existing radio stations received TV licenses - existing TV station receive HDTV spectrum - after initial allocation, secondary market License renewals: over 10,000 in the US since 1950s, only 50 contested, only 20 denied. Alternatives: - spectrum auctions (primary market) - unlicensed spectrum Trends: redefined basis for spectrum property rights

Spectrum policy trends Reallocation of spectrum from Federal government use to non-Federal government use Allocation of more spectrum for mobile as opposed to fixed applications Use of auctions to assign spectrum to particular users (started 94) Increased licensee flexibility in the use of assigned spectrum Continued support for unlicensed services Increased competition in the provision of all telecommunications services, including radio- based services Increased reliance on voluntary standards.