Senator CURTIS. That is all.

Senator HENNINGS. Thank you very much, sir.

We have permission from the Senate to continue, so, in order to accommodate Mr. Heffernan and with the indulgence of you, Senator, we will continue until we have heard Mr. Heffernan.

I have just been advised that there are 300 schoolchildren from Missouri right outside the door. I must ask that I be excused for a few minutes. If you will just go on, I will go out and see these youngsters for just a second.

Senator CURTIS. Mr. Heffernan, do you prefer to read your statement?

TESTIMONY OF JOSEPH V. HEFFERNAN, FINANCIAL VICE

PRESIDENT, NATIONAL BROADCASTING CO., INC.

Mr. HEFFERNAN. It is rather brief, Mr. Chairman. If you do not mind, I will read part of it.

Senator CURTIS. Proceed.

Mr. HEFFERNAN. My name is Joseph V. Heffernan. I am financial vice president of the National Broadcasting Co. I am appearing today at the request of the subcommittee to give you information concerning the use of radio and television for political broadcasts.

Growth of the television industry: In April 1952 I had the privilege of appearing before this subcommittee to discuss the use of television for political broadcasts. At that time I pointed out the phenomenal growth of the television industry since the end of World War II and its effectiveness in reaching a large audience in many parts of the country.

I am glad to be able to report to you now that the growth of the television industry in the 3 years since my appearance here has been even greater than in the 6 years the industry was in existence to that time. You may be interested in some figures illustrating this growth of television to a nationwide service:

Senator CURTIS. What does that mean, "number of United States markets"?

Mr. HEFFERNAN. That is in general the number of cities. There were 6 stations, for example; on the first line there are 6 stations in 4 cities. That meant some cities had two. New York, for example, has two. NBC and CBS were on in New York at that time.

When the 1948 campaign commenced, there were only 400,000 television receivers in the hands of the American public. When the 1952 campaign commenced, the number had increased to about 18 million.

Now they number more than 35 million and by the time the 1956 campaign arrives there will be approximately 42 million.

At the present time, about 43,600,000 families, comprising 91 percent of all families in the United States, live in areas which receive service from at least one television station. A relatively small number of these stations have not yet been hooked up for network service and are therefore unable to broadcast live programs at the same time as the rest of the network stations. However, the portion of the population so affected is only about 4 percent and will probably be less by the time the 1956 campaign commences.

Use of television: During the 1948 Presidential campaign only one paid political speech was made on the NBC television network. During the 1952 Presidential campaign 34 of such programs were carried. Television costs: I can best illustrate the present cost for television time on the NBC television network by giving you the total cost to a candidate of a sample lineup of stations purchased by a network sponsor for a half-hour program. The time cost of the 130 interconnected stations purchased by a sponsor of the George Gobel show, based on the rates in effect April 1, 1955, is approximately $52,500.

Since the charges for time are based on the aggregate of the network rates for each particular station carrying the program, the actual time costs to the candidate or other advertiser depends on which stations carry the program. The NBC television network rate guide shows the network rate for each station at April 1, 1955. I am submitting a copy of that for the record.

Senator HENNINGS. It will be accepted and without objection made an exhibit.

(The document above referred to will be found in the appendix, at p. 318.)

Mr. HEFFERNAN. In addition to these quotations, NBC will make available periods shorter than 30 minutes. The cost of these would, of course, be considerably less. I refer to these later in my statement.

You gentlemen are, I am sure, aware that it is also possible to buy time locally on a single station. Each station sets its own rates for such sales. The rates are based on a number of factors, including the size of market and number of sets. The range of rates is about as great as shown on the rate guide I have submitted. The exact rates of each station for local time are published monthly by Standard Rate and Data Service, Inc., 1740 Ridge Avenue, Evanston, Ill.

As far as dollars and cents are concerned, we believe that the medium of television can reach a greater audience per dollar spent than any other medium with the sole exception of radio. Our studies indicate that the time costs for a half-hour program carried by the 53 basic stations of the NBC television network would be about threetenths of a cent for each person over 21 in television homes if the program should be tuned in by a quarter of such homes.

I may comment on that, Mr. Chairman, for a moment. It is true that while the aggregate or absolute cost of television appears to be high, its effectiveness in reaching people is such that if you reach only 25 percent of the homes with two adults listening, it comes down to three-tenths of a cent per person reached as the actual cost per person, which is by the way, the way the sophisticated advertisers buy advertising time. They do not look at it in terms of the absolute cost for a half-hour but in terms of the cost per person reached.

Use of radio in campaigns: The benefits to be derived from the use of radio in political campaigns should not be overlooked. Although I have talked of television up to now, I have done so only because the growth of television has been so great in the past few years.

The following figures illustrate the cost of time on the full NBC radio network at this time, as compared with the cost during the 1952 presidential campaign.

You will note in radio the cost now is less than it was in 1952. The reason for that is that this industry, radio, is finding television a tough competitior and to meet competition, radio has actually reduced its rates.

Radio can reach practically every person in the United States and furnishes all the advantages of television except that of sight. And, as you can readily see, the cost of radio is much less than television. During the 1952 presidential campaign 45 paid political programs were carried on the NBC radio network.

Proposal of free time: I come now to the proposal that this subcommittee investigate the possibility of recommending legislation to require the radio and television networks and the individual stations to accord free time to political committees and to candidates for Federal office.

We are opposed to any such requirement. We are not opposed to the voluntary furnishing of free time by networks or stations to candidates or political groups, but are opposed to an attempt to compel them by law to do so.

That there are in fact more than 2 political parties in the United States and more than 2 candidates for the Presidency is often lost sight of in this predominantly 2-party country. I have listed in a table the names of 9 separate candidates for the Presidency in 1952 who ran under 15 different party labels. You will note that these are the figures compiled here by the Clerk of the House. The significant thing is taking the third candidate, Hallinan, that he got less than one-half of 1 percent of what Governor Stevenson got, and yet he was the duly qualified official candidate and running on down it becomes, of course, even less. But these are the official candidates.

The following information was compiled from statistics of the presidential and congressional election of November 4, 1952, compiled from official sources by Earl Rockwood under the direction of Lyle O.

Snader, Clerk of the House of Representatives (corrected to May 12,

In addition to these, there were many others who ran on the ballot or as writein candidates in one or more States, receiving among them a scattering of about 7,000 votes. NBC itself received communications from the following persons who had declared themselves candidates for the Presidency of the United States: Agnes Waters, Independent; Edward Longstreet Bodin, Spiritual Party; Herman W. Kolpack, American Party.

Even if we assume that in future elections only 9 persons run for the Presidency, the adoption of the free-time proposal would mean that for every hour of free time furnished each of the 2 major-party presidential candidates, 7 additional hours of broadcast time would have to be furnished to the other candidates.

Moreover, if a person or group could receive free broadcast time by satisfying the requirements of one or more States, we would have a flood of candidates. It is not comforting to consider the number of people and groups who would take advantage of a rule under which they could appear on a national television network, at no cost to them and for the same length of time as the two major candidates for President of the United States.

Finally, to require radio and television to give free time to candidates would place these media at a competitive disadvantage with other media, such as newspapers and magazines. While a newspaper or magazine could conveniently add a page or two in order to accommodate candidates, without any diminution in their regular advertising revenue and with relatively little additional cost of production and none of distribution, it is impossible for broadcasters to add an hour of time during the evening. All we can do is displace another program.

These points apply as well to local stations. While networks are important for national candidates, the stations have to concern themselves with national, statewide, and local candidates. Their problems are increased in proportion to the number of offices to be filled in the particular election and the number of candidates for those offices.

Public-service programs: We must not lose sight of the fact that networks and stations do furnish substantial amounts of free public

service programing in the field of political affairs. They do this cn a voluntary basis. For example, the NBC networks during the 1952 campaign broadcast such regular programs as Meet the Press, American Forum of the Air, Youth Wants to Know, Hats in the Ring, On the Line With Considine, and Ted Collins' Cracker Barrel Interviews on the Kate Smith Hour, while our own NBC stations broadcast various local programs of these types. In addition, NBC gave full news coverage to the campaign on such daily programs as the NBC News Caravan and Today. You are also familiar with the coverage by all the networks of the Democratic and Republican Conventions of 1952. We expect to continue this type of public-service programing during the 1956 campaign, with many of the same programs and perhaps

some new ones.

I come now, Mr. Chairman, to some proposals in 1956 in which we hope we can make constructive contributions to the problem before

you.

NBC has given a great deal of thought to the problems of candidates and national committees and how their television costs might be reduced. And we have sought within our own organization to break new ground to help solve some of the problems as candidates and committees see them.

I am glad to be able to report now that NBC is prepared to work with the national committees and others on four different proposals we are putting forward for 1956. We believe these will serve the dual objectives of reducing costs and creating flexiblity in campaigns. Here in brief are our proposals:

1. Reservation of time in advance to reduce preemption costs. NBC is prepared to work out with the national committees blocks of time which NBC would withhold from regular commercial sale and reserve for political sale in the fall of 1956. These time periods would normally be half hours, to carry the main speeches of the presidential candidates.

The principal objective here is to schedule the broadcasts early enough to avoid the costly preemption charges which would otherwise result.

The background of this proposal is that broadcast time is usually sold to advertisers on a consecutive 52-week basis, the programs being carried at the same time on the same day of the week each week during the year. Fall broadcast schedules are made up the previous spring.

As a result of this pattern of the business, when the national committees have previously begun their purchases of political time they have found the time they want on television already then sold to someone else. This does not mean they cannot get time. It is NBC's policy to preempt regularly scheduled commercial programs to make the time available for political broadcasts.

However, the commitments which have been made well in advance to the talent who are scheduled to appear on the regular programs and for scripts, other production costs and advertising agency commissions must be satisfied whether or not the regular programs are broadcast. These costs have to be taken over by whoever preempts a time period that has previously been sold.