ous non-duplication exclusivity. The FCC continues to unduly restrict the importation of distant signals by cable systems, and but for the courts would still be unduly restricting pay-TV operations. The FCC should be forbidden to protect broadcasters from cable growth. The separations policy, making the non-broadcast-retransmission capacity of cable systems into common carriers, should be adopted as federal policy, probably in legislation. We do not want to find cable systems with monopoly control over cable content when cable penetration becomes extensive. Finally, content on cable channels should have the same First Amendment privileges as newspapers and magazines. These policies will promote the consumer interest and further the cause of freedom.

APPENDIX

On the Cable: Report of the Sloan Commission on Cable Communications, (New York: McGraw-Hill, 1971).

GENERAL CONCLUSIONS

(1) The Commission believes it to be in the public interest to encourage the growth of cable television.

(2) The Commission believes that by the end of the decade a cable television system will be in existence which covers 40 to 60 percent of all American television homes; which provides in a majority of instances a capacity of twenty channels and in many instances a capacity of forty channels or more; which possesses a limited capacity for return signals from the home receiver back to the point of transmission; and which will be extensively interconnected, most probably by satellite.

FRANCHISING CONSIDERATIONS

(1) The Commission recommends that during the period of the present decade a limit of ten years be set upon cable television franchises, with provision for purchase at a fair price of unrenewed franchises. (2) The Commission recommends that franchises specify allocation of channels among various categories of use, including leased channels and public access channels. Minimum standards for such allocation should be prescribed nationally.

(3) The Commission recommends that franchises contain provisions which will enable the franchising authority to require the installation of augmented channel capacity, if it is found necessary.

(4) The Commission recommends that maximum rates to subscribers be set by franchising authorities.

(5) The Commission recommends that provision of service throughout the franchise area be made a condition of municipal franchises.

PAY TELEVISION

(1) The Commission concludes that the field of pay television should be laid open for the entrepreneur.

(2) The Commission recommends legislation that would reserve specified playoff and championship sporting events for conventional, sponsor-supported television, and would free other sporting events for competitive bidding between pay television and conventional tele

vision.

(381)

CABLE ACCESS TO PROGRAMMING

(1) The Commission believes that competition between the local broadcasting station and the cable system should be managed on the basis of equal opportunity of access to program and to audience.

(2) The Commission recommends that exclusive program rights within a geographical area be severely limited in time, with somewhat greater latitude permitted for first-run programs.

(3) The Commission recommends that cable operators in underserved areas be permitted to fill in the blanks in network service, without payment of copyright fees.

(4) The Commission recommends that the current policy of requiring cable operators to carry local radiated signals be maintained, without copyright liability.

(5) With appropriate copyright legislation, the Commission sees no need for special regulations governing the importation of distant signals.

OWNERSHIP

(1) The Commission recommends that network ownership of cable franchises be prohibited.

(2) The Commission recommends that a limit be set on the number of cable subscribers served nationally by any single individual or corporate enterprise engaged in ownership of cable franchises.

(3) The Commission recommends that local commercial television stations and newspapers of general circulation be permitted to seek franchises within their own Standard Metropolitan Statistical Areas, provided no single such enterprise possesses franchises capable of reaching more than 10 percent of the households within the SMSA, and provided also that such franchises, in the aggregate, be capable of reaching no more than 40 percent of all households in the area.

(4) The Commission recommends that Public Television stations be permitted to operate cable franchises without market restrictions. (5) The Commission recommends that restrictions on commercial stations and newspapers be waived if no other bidders for cable franchises appear.

(6) The Commission urges that local franchising authorities give preference for ownership to community non-profit and profit-making institutions within neighborhoods which have special social or ethnic problems and needs.

(7) The Commission believes separation of ownership and programming to be undesirable during the growth period of cable television, and consequently does not now favor common carrier operation.

FEDERAL REGULATION

(1) The Commission urges that the Congress resolve the issue of copyright by legislation bringing up to date statutes governing the property right in intellectual products.

(2) The Commission recommends legislation acknowledging the power of the federal government to protect the viewing public if the growth of cable threatens to deprive any significant sector of the public of broadcast service.

(3) The Commission recommends the establishment of minimum standards for the allocation of channel uses within cable systems;

minimum technical standards; minimum standards for channel capacity in new systems; non-discriminatory access to leased and public access channels; and rules on ownership of cable franchises.

(4) The Commission recommends that Congress limit the powers of the state and municipalities to impose a gross receipts tax or similar levy on cable systems.

(5) The Commission recommends that Congress authorize and provide funds for a program, conducted outside the regulatory agency, that would encourage the wise use of cable.

STATE REGULATION

(1) The Commission recommends that each state establish a special agency empowered to direct and regulate the growth of cable television.

(2) The Commission recommends that such state agencies be empowered by legislation to identify appropriate franchise areas within the state; to identify or bring into being officially constituted franchising authorities for each such area; to establish standards above federal limits, where appropriate, for system capacity, technical characteristics, performance and compliance, allocation of channels, nondiscriminatory access, duration of franchises, and the like; to require uniform accounting methods; to require that rate-cards, franchise terms and compliance records be deposited with the agency and to make that material generally available; and to receive and adjudicate appeals with respect to cable operations.

(3) The Commission recommends that state agencies of the sort described above be prepared to delegate major portions of their powers to major cities within the state, in conformity with ordinary "home-rule" procedures.

GENERAL CONSIDERATIONS

(1) The Commission recommends that the fairness doctrine not be applied to the operation of public access channels.

(2) The Commission recommends that the equal time rule be considered inapplicable to cable television.

(3) The Commission_recommends that the appropriate legislative bodies modify existing laws to remove the liability of the system operator, as such, for violations of laws concerning libel, incitement to riot, obscenity, and the like. Liability would remain for those who program the channels, including the system operator himself to the degree that he provides programs.

Cable, Report to the President, The Cabinet Committee on Cable Communications, (Washington, 1974).

LONG-RANGE POLICY RECOMMENDATIONS

INDUSTRY STRUCTURE: DISTRIBUTION

Recommendation 1: Control of cable distribution facilities should be separated from control of programming and other services provided over the channels on those distribution facilities.