Admiralty Ballroom
Hilton Crystal City
2399 Jefferson Davis Highway
Arlington, VA
Wednesday, September 9, 1998
AFTERNOON SESSION
(1:37 p.m.)
MR. MOONVES: All right. Barry will be joining
us a little bit late, he said. A couple more housekeeping
things.
There is some sad news and good news. Anne
Stauffer, who has served as our liaison officer, has
accepted a 3-month detail as an analyst in the Office of
Management and Budget, so unfortunately she will be
leaving us with our thanks and best wishes.
However, Sally Ann Fortunado will be working
with us while Ann is away, and Sally Ann, are you here?
Okay. She was here earlier. I met her. She seems very
nice. We're very lucky to have her.
MR. ORNSTEIN: The good news is that when Anne
is at OMB she can change all those scoring rules.
MR. MOONVES: And there's no official word from
the White House, but there is every indication the
extension request will be granted, the reporting deadline
still to be determined. If they say no, does that mean we
have to turn it in this week?
Anyway, let's begin by talking about political
discourse. We will go into that, then we will talk about
some of the other issues. Karen will make a report, as
well as Jose Ruiz. We'd like to hear from you later on.
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Yes, Charles.
MR. BENTON: Les, just one cleanup item from
this morning. The disclosure points are wonderfully
spelled out here, and terrific, but I don't know -- it
seems to me the ascertainment dimension, which was
discussed on several occasions in past meetings and, in
fact, Robert Decherd made considerable points in his paper
about the need for assessing community needs and the
ascertainment procedures.
I just wanted to suggest that maybe we need a
separate short section in here that is at the same level
as the voluntary standards and disclosure on
ascertainment, because ascertainment is the heart of
understanding what community needs are.
If we don't understand what the community needs
are and if there is no procedure for determining that,
then it is hard to follow through the rest of the process.
MR. MOONVES: It is one of the proposals that
Jim has in his group of minimum standards. As of this
moment I don't think we know what is going to be
incorporated in that. However, clearly that is one of the
things that should be discussed.
MR. BENTON: To strengthen that particular
point, great. Okay. Wonderful. No problem.
MR. MOONVES: And once again that will be --
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Norm and I talked about it -- a couple of subcommittees
formed on the minimum standards issue as well as
disclosure. We will go from there.
Clearly, when this committee was formed,
probably the most pressing issue, or the most certainly
public issue dealt with political discourse. Norm and I
have tried to formulate -- once again of all the things in
this paper I would say this probably is the most general,
and we are open for a great deal of discussion,
interpretation on what we feel needs to be done.
Clearly, something that we both feel is
extremely important is that anything that the television
broadcasters do should be part and parcel of a much larger
campaign finance reform situation, something that, Newt, I
know you would like to address.
In addition, we should talk about the 5-minute
rule, which is something that we both can embrace once
again, as long as it is part of something further.
So Newt, would you like to begin the discussion,
please?
MR. MINOW: I am sorry Barry Diller isn't here,
because I really want to pick up a suggestion he made on
our very first meeting, which was that the broadcasters
act as the good guys, the heros here, and put this
question to Congress as follows, as a challenge, as a
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challenge grant, that broadcasters will provide X hours of
time for political candidates without charge as part of
their public service provided that Congress reforms the
current political finance rules, and put the burden on
Congress.
In the business it is what we call an if-come
deal. If Congress does this, then we will do that, and I
think that would be the framework that I would suggest we
take Barry Diller's proposal and put it as a challenge to
Congress.
MR. MOONVES: I do not disagree with that. The
question is, what do they put to Congress, and what is the
if and what is the come? How far do we go in our requests
of Congress to make changes in campaign reform, as well as
what are we giving in exchange? In exchange, are we
giving the 5 minutes to them, or are we giving something
further? I think those are the questions.
Yes, Bill.
MR. DUHAMEL: The only question I have is
whether Congress really wants to do campaign reform. You
see, you're assuming they want this.
MR. MINOW: I am assuming it would put the
public pressure on them.
MR. DUHAMEL: Because I do not think they really
care.
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MR. MOONVES: That is the idea, is to be able to
use this leverage to put pressure on them to do something
that they would not normally do, and on behalf of the
broadcasters, Newt, we do appreciate the broadcaster being
the good guy for a change.
Yes, Jose.
MR. RUIZ: After our first meeting, Newt passed
out a paper on a global look at how campaign advertising
is handled. There is only two nations, or three nations
that are out there.
MR. MINOW: There are three countries that do
not require by law some sort of public service time, the
United States, Sri Lanka, and Malaysia.
MR. RUIZ: And also paid advertising.
MR. MINOW: Many countries prefer that paid
advertising -- such as Great Britain allows no sale or
purchase of time for a political candidate.
MR. DUHAMEL: What about newspapers?
MR. MINOW: In Great Britain they are permitted
to have newspaper ads, with some sharp limits on how much
they can spend.
MR. RUIZ: I think we should look at the British
model and see if it is not something, as it pertains to
broadcasters, that we might not want to adopt.
MS. SOHN: I think the British model is
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interesting, but there is one problem. The British do not
have a First Amendment, and I think that while I agree
with the principle, I really think there would be a
problem telling broadcasters that -- telling candidates,
not telling broadcasters, that they absolutely could not
buy time. I think you run up into a little bit of a First
Amendment problem.
MR. ORNSTEIN: Well, the British system is very
different from ours. The British tradition is different
from ours, but the system is. You have no tradition there
of individual candidates running individual campaigns.
They are national parties. It's a small, homogenous
country that has until recently not had anything
resembling local or targeted television. It is a national
television audience.
There was a group of British Members of
Parliament who now are formed into a campaign finance
reform committee who came to Washington several months ago
to talk about their own system, and they met with several
of us, and what is also clear is that as the world
changes, as we move to a digital world, and a world where
pictures are transmitted in so many different ways, it's
not clear they can hold to their own system.
Let's say, for example, that a group of British
expatriots decided to put on substantial advertising on
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CNN, that would go to Britain through the sky channel and
other mechanisms, whether they would have the ability to
block that from taking place.
So the world is going to change, as our world is
going to change, and the nature of communications is going
to change in dramatic ways, and we can't even predict in
what ways as we move to a digital age.
I would posit that advertising more generally,
in an era of far more sophisticated remote controls and
many, many more channels, is going to move in two
directions simultaneously.
One is going to be, to take advantage of an even
more fragmented attention span, product placement and
advertising integrated into programs, because if you move
to commercials people will automatically switch out, and
at the same time I think we're going to move to longer
segments, 5 minutes or more, that take the form of
stories, so that you can actually get people to pay
attention and in a serial way carry along.
And maybe as regular advertising moves in that
direction, if it does, that political advertising will,
and we will have not only the challenge of even shorter
hit and run spots, but the opportunity of something more.
We can't predict that, but what we can do is to
figure out how we can in some fashion improve political
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discourse and satisfy that responsibility now and in the
future with an appropriate trade-off, and what Barry
suggested, what Newt is talking about, if we handle this
in a good way, it seems to me we can, in fact, move from
an image of broadcasters as the evil guys to broadcasters
as the good guys, broadcasters making a challenge to
Congress.
And Bill is right, most Members of Congress are
more than a little reluctant to move in that direction,
but the best thing to do under those circumstances is to
create every opportunity for them to change their minds by
turning the focus where it appropriately belongs, which is
on lawmakers manipulating their own system.
So there, if we make this a challenge, and
indicate that reform should not be solely on the backs of
broadcasters, but that they will play a very significant
role here, as they should, that is appropriate, and the
question is, what would we make as the quid pro quo.
MR. BENTON: Just to follow up on Norm's comment
here and Newt's reminding us of Barry Diller's very
important interjection, and I think it was our second
meeting, our third meeting early on, the House, of course,
as you all know has passed the Shays-Meehan campaign
finance reform legislation severely restricting third
party advertising and limiting soft money.
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Everyone said this would not happen, this was
impossible, but it did happen.
The Senate apparently has announced that it will
vote on some campaign finance reform legislation. Whether
that will take place this fall or whether it will take
place next year is anyone's guess -- probably next year.
But if one thinks, Norm, as you were saying,
about the broadcaster's long-term self-interest in the
context of the new Telecommunications Act, where you now
have one regulatory framework encompassing broadcasting,
cable, and telephone, the broadcasters can position
themselves as the democracy channels, the pro-democracy
channels.
We all know that our system is in deep trouble
politically, that money is corrupting the system big-
time. It is a bipartisan corruption. This is not
Democrats or Republicans. The system has totally spun out
of control.
And if the broadcasters -- and 55 percent of all
the money spent in Federal campaigns goes to buying back
the public's air waves, our time. If the broadcasters can
step up and take a leadership role here, not in solving
but in contributing to the solution of the mess that our
electoral system is in, and thereby really serving the
public interest, convenience, and necessity big-time, I
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think this is a long-range win-win or the broadcasters.
And positioning themselves vis-a-vis their long-
term competition there's just a lot to gain here, and
looking at it not in terms of, oh, gosh, I'm going to lose
the advertising revenue, which is minuscule, I mean,
during elections, compared to the big picture, but
fulfilling their public interest obligations, there's just
a tremendous opportunity here.
MR. MOONVES: Anybody else? Yes, Jim.
MR. GOODMON: I'm supportive of this notion. I
want to make sure that we're talking about program time,
not giving commercials, and that when we talk about
program time the candidate must appear. I mean, there are
two or three things here that I think really will help
this.
The program time -- I think I did 3 hours. 60
days before the election, 5 minutes a day is 300 minutes.
That's -- okay, 5 hours, 4 or 5 hours of time we're
talking about, even if we do the 5 minutes.
But the point is, the candidate must appear in
this free time, and there are two other things I want to
suggest, and one is that if we're going to have the lowest
unit rate, if there's going to be a preferable rate for
political advertising, that should only be for political
advertising in which the candidate appears.
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This is for the candidate to be on the air, not
for a third party attack, and it's not just the candidate
comes on at the end and says, paid for by, but that for 50
or 75 percent of the spot the candidate must appear, if
there's a lowest unit rate involved, some preferable rate
for political candidates.
And then the other thing that I think would
really help is, stations can already decide whether or not
to take issue advertising. We can turn that down and say,
we don't want it, or we can take it.
The abuse with the soft money and the third
party advertising comes in when they talk about candidates
and political parties in a nonpolitical way, so my
suggestion is that issue advertising 60 days before the
election cannot contain the name of a candidate or a
political party, and that will stop the soft money, and
that will stop that issue advertising stuff.
Those are the three things I think we have got
to work on, but the issue advertising is what is
distorting the marketplace, and that is money spent by
third parties "nonpolitically" to talk about candidates
and political parties.
So if we say you do issue advertising, third
party advertising, you can talk about medicare, but you
don't say, call Senator Jones because he disagrees with
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us, or call Senator Jones and tell him what you think.
That is an obvious attempt to get votes for or against
that candidate.
If you say you can't talk about a candidates,
you can't talk about political parties 60 days before
election, we don't have a soft money problem.
MR. CRUZ: I think in making our appeal to
Congress for a quid pro quo of some sort is something we
can offer up as a forum. I agree with that concept and
endorse that idea. Perhaps the lowest unit rate might be
also the other attractive thing for Congress to take
action.
There is a cable company in Los Angeles that
announced that for this coming fall campaign in the Los
Angeles area they were going to offer free air time to all
politicians, local, State, and Federal, for a 1-minute
spot. They must be on it. There would be no editing, and
they would all have to answer the same questions
pertaining to their particular race that they were
involved in.
And the reason why they did it -- I've forgotten
the name of the cable company in the Los Angeles area
that's done it, but apparently the reason why they did it,
it was their effort of showing that this whole area of
campaign finance reform and the problems that political
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money, soft and otherwise, have done to the democracy and
to the democratic process of our country.
So it was their effort at doing that, so I
think, you know, ventures like this, I think if we can
take some stances in that direction, not necessarily in
that simple way, but I mean, in maybe the lowest unit rate
reform or modification might be the solution to put the
onus on Congress to act.
MR. LA CAMERA: Just to go back to this concept
of the 5 minutes per day, we spent a good amount of time
on that. Everyone seems comfortable.
MR. MOONVES: I think we have consensus that as
long as that's part of a larger campaign, you know, and
once again, Newt, I wouldn't mind, when Barry gets back,
if you and Barry could work on some language about what we
would like to present to Congress in terms of that. This
would be part of it.
I think if that, in fact, happens, I think
there's a consensus on the 5-minutes as written here. Any
comments on that? Bill.
MR. DUHAMEL: I'm still puzzled -- you know, you
want this voluntary 5 minutes, but why don't we tie that
to the lowest unit rate. We aren't going to get it done
in October this year, obviously.
But I mean, the biggest problem for the lowest
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unit rate is -- it doesn't cost us a lot of money. We
don't know where we are, and when we get done we box it
all up, tape the box up, and then hope nobody ever comes
in, because we make a good faith effort and we still don't
understand it.
MR. MOONVES: We address that on page 9, the
repeal.
MR. DUHAMEL: But I'm saying why don't you tie
it to the 5 minutes, the voluntary 5 minutes a night.
MR. ORNSTEIN: It's hard to do that, Bill,
because the 5 minutes we're talking about here is
completely under the control of the broadcasters to
determine candidates in races.
There are obviously going to be a lot of
candidates in races who aren't included in that, so I
don't think we can raise the rates without something in
return for the broader mass of candidates.
And that's where, if you work out an exchange in
terms of some provision of additional time at market
rates, you can get rid of the lowest unit rate, all that
uncertainty, all the headaches, and a system which as we
move towards digital is increasingly going to become
completely meaningless.
And frankly it's going to become
counterproductive, too, because one of the difficulties we
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have here with so-called issue advertising is that there
you have groups who pay market rates, and the more they go
in and want to do that, the more incentive there is for
broadcasters to find ways out of offering time at a
discount.
So there are reasons to try and work an exchange
there, but it doesn't tie to 5 minutes, which we hope in
addition to, by the way -- and I think we ought to mention
here the extraordinary innovations that other broadcasters
are doing.
What Harold has put on the table for us from
Hubbard, and all the things that are being done there, is
just a terrific set of ideas, what Belo has done with It's
Your Time, and Hearst-Argyle has done, and Jim has done on
his own with his station, and it's multiplied in a lot of
different places.
But there is an advantage to finding a formula,
which is what the 5-minute 30-day does. That is not a
terribly onerous thing. That doesn't necessarily involve
a minute of commercial time, that can provide a much
broader range of innovative ways of giving candidates a
voice here.
MR. DUHAMEL: But I was thinking you'd get more
acceptance if you could get rid of that lowest unit rate.
You'd have broadcasters saying, just to get rid of that
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uncertainty and mess, let me go do it. That's what I was
thinking. I was trying to get this thing adopted quicker.
MS. SOHN: The problem with that connection,
Bill, though is, if it's voluntary, okay, you'd be
repealing the lowest unit rate for everybody, regardless
of whether they sign on to the voluntary or not. You
can't repeal a law as to some people -- I guess you could.
Congress could say, well, if we do this voluntary thing
then you don't have to do this lowest unit rate. That
would be a conundrum that's not going to happen.
So that's the problem. If we want to talk
about, I'd like to raise it at some point, what was in
Jim's thing, some minimum mandated free time, then we
could talk about tying it to the lowest unit rate, but if
it's just voluntary I don't know how you could do it in a
way that works.
MR. MOONVES: It is apples and oranges.
Also in the 5-minute thing the stations can
choose exactly which race, which candidates, which issues
they want to deal with, so I think it's nearly impossible
to tie the two together.
Yes, Newt.
MR. MINOW: For the record, I know I'm a
minority of one -- actually, a minority of two. Oh,
you'll be surprised when I tell you who the other one
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is -- when I believe that you do not have a constitutional
right to buy broadcast time even if you're a candidate,
and I believe we should not have the purchase and sale of
time for political candidates.
Eddie Fritts, the head of the NAB, proposed that
in exchange for a certain amount of what he called free
time, that there should be a promise that the candidates
would not purchase any time.
I happen to agree with him, and although I know
nobody else will agree with us, I just want for the record
to say that's where I would come out, because I believe
that candidates will simply purchase more and more and
more time, and they'll have attack ads and everything
else, and we won't get rid of this corruption of the
democratic system.
MR. RUIZ: That's my point. If you cannot make
attack ads, if you can't somehow control the amount of
time a candidate can buy, what are we solving? I don't
care how much time you give them.
MR. CRUZ: My suggestion is, political time that
gets the lowest unit rate is only for candidates'
appearances. If we make candidates appear, then you don't
have attack ads.
MR. DUHAMEL: You still have attack ads. You
just wouldn't have it at the lowest rates.
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MR. CRUZ: Right. It would be out of the
political -- candidates don't do the attacking. That's
all I'm saying.
MR. ORNSTEIN: The answer to what you're saying,
Jose, is, we're dealing with a situation where there is no
solution. You have trade-offs here. There is a First
Amendment that guarantees and demands robust debate and
speech. There is nothing you can do to control the
content of that, nothing we should do to control the
content.
What you can do is try to provide a structure
and an atmosphere where you can give opportunities for
candidates who otherwise would not be able to get a
message across, and incentives to get a less negative
message across, and you can move that trade-off a little
bit more in a positive direction. We have an opportunity
to do that now, and as much as we can, we should.
MS. SOHN: Also the other thing besides the
First Amendment, you also have the reasonable access law,
which also is problematic, which guarantees reasonable
access to Federal candidates, so if you ban selling time
to them, I agree with you in principle, but I just think
you have a very, very difficult row to hoe legally, but --
whatever.
I'd like to sort of flip that around, because
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some stations, and this was very, very salient in
California and also in Virginia, have adopted basically
blanket bans on selling time to down-ticket candidates, to
State candidates, and I'd like to see us perhaps maybe as
part of the voluntary work, that we mandate, have such a
prohibition on a blanket ban on selling time or giving
time to local and State candidates.
Because I think, you know, Federal candidates
get plenty of time, and in fact your proposal is mostly
based on Federal candidates, candidates for Congress and
Presidential, but it's the local and State candidates that
aren't able to get that time.
MR. CRUMP: The reason for that is, you still
have a thing called equal time, and we have to provide
that. When you sell for one you have to provide for the
other, and you get into these situations, there's not
enough time in the day to take care of everybody that
wants to come in and go and do, and it has to be equal all
the way through.
MS. SOHN: But what candidates that you elect
are going to make the decisions that you really care about
in your every day life? Your Congressman, rarely. It's
usually the city council member or the Governor.
You know, in Virginia they stopped selling time
to gubernatorial candidates, an incredibly heated race.
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I mean, again you don't have to sell them
time -- in fact, there is no reasonable access,
unfortunately, for State candidates. That's why you can
have these bans in the first place. But to have this
blanket ban and say we'll never sell you time -- it's one
thing to say, okay, we're not going to sell you time every
night. That's unreasonable.
It's another thing to say, we're never going to
sell a down-ticket candidate, anybody lower than the
gubernatorial race. We're not going to sell any State,
any local, city council, we're not going to sell. That's
the other side of that coin.
MR. MOONVES: How would you determine -- in
other words, X amount of time that could be sold at your
station.
MS. SOHN: You can't just say, I will not sell
to any State or local candidate, a blanket ban on any
State and locals. Yes, well, the dog catcher is running
unopposed, obviously, you know, it would be very
reasonable for you to say --
MR. MOONVES: There's a blanket ban?
MS. SOHN: Yes.
MR. ORNSTEIN: In several instances there were
announcements of blanket bans, and I've become convinced
through our discussions that you can't require reasonable
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access for all candidates for all levels, because there
just isn't time for it, but it is perfectly appropriate to
say that blanket bans are wrong.
Let me just add, one of the very strong pluses,
I believe, for the 5-minute suggestion is that you leave
it open to stations to pick those races which are not in
every, or even most instances going to solely be Federal
races.
They are much more likely, in fact, to include a
mix of State and local as well over that 30 days to give
access for candidate discourse, so you can actually create
a better opportunity with that to get that appropriate
blend, and every station would then choose which races
that station believed were the most significant ones and
provide some opening time.
MR. MOONVES: Anything further?
MR. RUIZ: We cannot ban paid advertising, but
we could make certain requirements for the content, the
way the content is delivered, is that correct?
MS. SOHN: No, I don't think so.
MR. RUIZ: We can require that they appear?
MR. LA CAMERA: If it's the lowest unit rate,
there can be a requirement that the candidate appear.
MR. MOONVES: He's saying they can, but Gigi,
who's an attorney, is shaking her head vehemently.
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MS. SOHN: On that I think you probably could,
but Jim was talking about banning issue ads saying things
like they can't say the politicians name. That may be
desirable.
MR. GOODMON: Issue advertising, no one has the
right to have issue ads run. It's up to the station, and
the station could edit it in any way they wanted. The
station could have any rules they want about issue
advertising. I'm suggesting they should if they want to
get away from the issue ads distorting the process.
Stations can say no. There are plenty of
stations that don't take issue advertising at all.
MS. SOHN: Right, understood. I would propose
increased sponsorship identification as opposed to your
suggestion.
I think having bigger sponsor ID paid for and
realistic sponsor ID, as opposed to paid for by North
Carolinians who like good things. That's really lousy
sponsor identification, but it's with clearly North
Carolinians for what we're really talking about.
MR. LA CAMERA: Gigi, on the reasonable access,
how do you intervene in the content of the Federal
candidate's spot? I didn't think we could in any way.
MS. SOHN: You can't. He's talking about issue
ads.
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MR. MOONVES: You're saying lowest unit rate, a
candidate cannot say something bad.
MR. ORNSTEIN: You can't in any way dictate what
the content of those spots should be, but in the process
of providing incentives, just as you can't have mandatory
spending limits under Buckley v. Valeo, but you can have a
voluntary system where you get an incentive if you limit
yourself.
You can have a situation where you get an
incentive if you appear in your own spot, as opposed to
something else. That theoretically can be done.
But of course, even in that area we have to be
very careful. It's a very slippery slope that you get on
when you try to have an impact on the content, which we're
probably better off not doing.
MR. MINOW: Just a word about the First
Amendment in this area, because I think it gets very
confused.
If you are arguing a case in the United States
Supreme Court, you are allocated a certain amount of time
to make your case, usually 30 minutes each side. The
people who are arguing that the First Amendment means that
money is speech, and speech is money, should try to go to
the Supreme Court one day and say, I don't want just 30
minutes to argue my side, I want an hour. Here's a check.
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I'll purchase a half-hour to argue for an additional 30
minutes. The Supreme Court would throw you out --
MR. ORNSTEIN: Well, wait, how big is the check?
(Laughter.)
MR. MINOW: -- even though it is a public forum.
My point is, speech is not money, and money is
not speech, and access to television can be provided a
certain amount of time with no interference with what the
candidate says to comply with the direct democratic
process reasonable access.
I know I am alone in this, but some day we will
come to the point where we will say selling time on
television for politics is not required under our
Constitution, and it is a bad thing to do for maintaining
the kind of Government and kind of campaigns we want.
That's the end of my speech. I just want that
on the record.
MR. BENTON: Let me just pick up on this,
because this is really new thinking, and it's courageous
thinking, and I'm just wondering how Newt, especially in
line with Les's challenge to you and Barry to come with
some wording, how we can at least seriously get that idea
on the table for further discussion.
Because it may not be the flat-out
recommendation of the committee, but it seems to me that
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one of the functions of our report could be to get a
serious idea such as you have posited out for serious
discussion, and I would certainly applaud our so doing.
It may not be possible. There are lots of nay-
sayers. You're going to have the whole vested interest of
the political consultants against you, et cetera, et
cetera, and the challenging incumbents arguments about
it's the only way to successfully challenge incumbents.
There's arguments on all sides of this issue, as
we all know, but I think to get this point you made, since
we live in an imperfect world and these are trade-offs, in
effect, to think about what we've lost by allowing this to
happen, and getting this in the report in a serious way so
this will stimulate further discussion about this idea of
yours and Eddie Fritts, and if Eddie Fritts will really
join you on this seriously, I mean, I think it's very
provocative, and why not get this laid out in a serious
way for further discussion.
Isn't that what our report is supposed to do?
We are supposed to recommend ideas for the policy-makers
and for further discussion. We can't legislate anything.
We can't administratively rule it, but I mean, I think
this would be very constructive. Why not?
MR. MINOW: Well, I will, as part of this, write
a dissenting or concurring or whatever, statement on it
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for anybody who wants to join, but I know it's not a view
that will meet with large support.
MS. CHARREN: I was going to say that something
like this could be an opinion or op ed piece. Certainly
Newt can get op ed pieces in the paper, and not part of
the report per se.
MR. ORNSTEIN: I think if Newt wants to put it
in in a strong way as an opinion, it ought to be there.
MS. PELTZ STRAUSS: You may get more support
than you think.
MR. MOONVES: So we're in agreement. We're
going to propose this as part of our larger finance
campaign reform situation. Any further comment about the
5 minutes?
MS. PELTZ STRAUSS: I have a question on this.
It's actually more a point of clarification on the
language.
On page 8, the final paragraph, the third
sentence says, for a modest commitment of time during a
brief period every 2 years. Were you talking about
Federal elections when you were referring to that? I
thought that this 5-minute period was for any kind of
election. Am I misreading that?
MR. ORNSTEIN: I think the initial cut here was
for Federal elections which encompass a very broad range
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of most State elections, but certainly not all.
MS. PELTZ STRAUSS: You just may want to make it
consistent with the last sentence in the second paragraph
that talks about candidates and races, Federal, State, and
local.
MS. SCOTT: Some elections are --
MS. PELTZ STRAUSS: Every 6 months.
MS. SCOTT: Or in the spring or in the fall.
MR. MOONVES: I think we ought to leave the
language open, however. I don't think broadcasters will
want to do it every 6 months.
MS. PELTZ STRAUSS: I'm not saying, say every 6
months. You may just want to dilute that whole sentence.
It may be just easier to take it out.
MR. MOONVES: Yes, Gigi.
MS. SOHN: Tell me if this is the appropriate
time. I do want to raise the issue -- actually Bill sort
of raised it for me by talking about the unlikelihood of
Congress passing real campaign finance reform, and perhaps
because of that reality we should consider making a
recommendation to the FCC that they require some minimal
amount of time.
I think we should do it, for the reasons Bill
stated, for the reasons stated in my proposal. I think
it's good for democracy. I think it sets a floor, and I'd
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just be interested in hearing what other people have to
say about it.
MR. GOODMON: Here was what I was trying to say.
If you agree there is some public affairs programming
obligation, then what I was suggesting, that at certain
times of year, this would be that.
I mean, it's not the public affairs programming
and this, that as part of the -- this would just say that
as part of the commitment for public affairs programming,
this 5-minute political would be done as part of that, not
in addition to, but it would be part of the mandates.
MS. SOHN: I understand that. The critical
thing in my proposal is that, again, it doesn't need to be
one way or the other. It could be the 5 minutes, it could
be programming that's exempt from equal time, it could be
mini debates, it could be a time bank.
I don't think we should necessarily tell the FCC
what they should do, but the question that I raise to the
committee is, is this something we should recommend, is
this something that's good for democracy?
Do we really think our -- I think the
congressional recommendation is a very good one, and I
wholeheartedly support it, but is it really going to go
anywhere?
MR. MOONVES: I want to address two points, and
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I disagree with you in two different ways, Gigi, with due
respect.
Once again, as I said before, if we want to make
proposals that the broadcaster will throw right back at
Congress and we will get nowhere with that, that will
happen.
Number 2, if we can in fact effect a true
campaign finance reform, this committee will have done so
much more than the rest of these things, which are
recommendations that are going to go to the FCC, it's
going to go to Congress, it's all going to be very nice.
But if, in fact, we can have some part in
pushing them over the top, that could be so significant in
terms of, you know, you talk about democracy. That really
could affect democracy, and if we leave it both ways,
you're going to lose your effectiveness. That's my
feeling.
MR. ORNSTEIN: I might also add I'm very hopeful
that a large number of broadcasters will take on
themselves the 5-minute idea soon and experiment with it
as a part of this.
We hope that experimentation will lead to all
kinds of innovative ways of, in this situation
broadcasters have an incentive to put on interesting
things during that time to keep their viewers, and we may
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find very innovative ways of using a minute or two or
three that can provide great access.
So that doesn't have to wait for the if-come-
maybe of comprehensive campaign reform. It could come and
should come and I hope will come very soon.
MR. DUHAMEL: Doesn't the equal time provision
still have to be waived?
MR. ORNSTEIN: That obviously has to be done by
Congress, but even without that, without that you are
going to lose in some cases opportunities, because clearly
incumbents will turn down opportunities just so they can
keep challengers off the air, so we'll have to live with
that obstacle.
But in the meantime, broadcasters can still
reach out and find, no doubt, lots of races that are of
great significance to their communities and find
innovative ways of taking in a 5-minute period each night
through mini debates, interviews, providing time to the
candidates, and other things, ways of getting that
discourse out there for their communities and of giving
candidates opportunities they wouldn't have had otherwise.
MS. SOHN: I just wanted to get back -- since
nobody seems to have anything to say about the FCC
recommendation, I will just tuck my head in and go away.
I feel strongly about it, but let's move on.
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On the State ban, the ban on State and local
candidates, that's something you would want to include?
MR. ORNSTEIN: I see no reason not to put in
language against bans on advertising. I don't think we
can put in a requirement for reasonable access for
everybody, but overall bans, that certainly, I believe, is
very much worthwhile.
MR. GOODMON: You never say you have an overall
ban. It's just if the sheriff's candidates come in, you
say you're not going to do the sheriff. You're not going
to publish this ahead of time.
MS. SOHN: Believe it...some of your colleagues
have been quite bold in that regard, Jim.
MR. ORNSTEIN: But increasingly in the last
campaign they have been saying that.
MR. GOODMON: But after you get asked it, you
say you do, but you don't want to announce a policy. You
don't know what's going to happen with the air time.
MR. MOONVES: There's no reason why we can't put
a recommendation in.
MR. CRUMP: You see, when you get down to it,
you may not have a requirement, a Federal requirement for
equal time, but you feel very strongly that if you get
into this you talk about leaving yourself wide open for
all sorts of problems and bad publicity because you sold
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this guy but now you have to sell to his opponent.
So when you look at this, you usually look at
how am I going to be able to satisfy everybody that comes
into this particular race. You just don't. You just open
the door for problems.
MR. ORNSTEIN: This, I think, we can dispose of
very, very quickly. We know that we had that testimony
from the Working Group on Natural Disaster Systems of the
Federal Government.
There are clearly tremendous opportunities
within the digital framework to provide very sophisticated
early warning alerts to people about natural disasters.
It seems very clear that this takes the tiniest portion of
the spectrum. It's the equivalent of a human hair across
a super highway.
But it is worthwhile for us, as they have
recommended, to write in that the capability to broadcast
basic early warning systems is a public interest
obligation, working with emergency specialists to make
sure the most effective way to use the bandwidth is
covered.
And I would suggest, even though it also goes
beyond our narrow mandate and our responsibilities, that
in this area, as looking ahead to our discussion of closed
captioning and video description, that we put in a
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recommendation to set manufacturers and other equipment
manufacturers that they build in the capability for these
things looking ahead, rather than have to rely on the much
more expensive and inefficient retrofitting.
MR. DUHAMEL: Norm, didn't the FCC just allocate
24 mH of bandwidth for public safety? Would that be the
place to do that on their bandwidth? I thought that was
in the last month or two.
MR. MOONVES: Not that I'm aware of.
MR. DUHAMEL: That's why I'm thinking, if
there's already something allocated --
MR. ORNSTEIN: Well, there's space allocated --
that's for other things.
MR. DUHAMEL: I thought that was public safety.
MR. ORNSTEIN: I think that's for things like
911 calls and ambulance services, communication over
secure bandwidths for the police, and other forces. It's
not the same thing as having available when there's a
tornado coming, that every station says there's a tornado
coming.
MR. DUHAMEL: Because we have it on the EAS
right now.
MR. ORNSTEIN: We're talking about taking
advantage of new and sophisticated technologies and what's
not going to be an additional use of bandwidth
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particularly, just making sure that it's there.
MS. PELTZ STRAUSS: Actually you gave me a
perfect lead-in to the last one I wanted to mention, so I
want to do that now. I just want to support what you just
said, which is to make a recommendation to basically make
it easier for broadcasters to apply new closed captioning
technology and video description technologies to make
recommendations to manufacturers to incorporate in the
design of their sets the capability for carrying out these
technologies.
That's my last recommendation. I will mention
it first. You have actually all at some point --
MR. DUHAMEL: You'd also have to add in the
producers, to put the description in.
MS. PELTZ STRAUSS: For the producers of the
programming? That would be fine for me.
MR. DUHAMEL: If they don't do it, it doesn't do
any good.
MS. PELTZ STRAUSS: Well, that's a whole
different issue. You're talking about requiring video
description, and I'm not really going to get into that.
I'm talking about providing a capability to transmit video
description once its provided by producers.
Last April and then again last May I submitted
to the committee a proposal for the obligations for
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individuals with disabilities, and basically this is just
to reiterate what I already submitted.
I know that the NTIA has been playing around
with some of the language and, as I understand it, there's
a series of five or six recommendations, the last of which
is the equipment one that I just mentioned.
The first one is for broadcasters as well to
take advantage, full advantage of the new digital closed
captioning technologies, and I'm not sure how you want to
handle this. Shall I just go through all of them?
MR. DUHAMEL: Did this come out in the packet?
This is not in the package.
MR. MOONVES: Karen, if you could distinguish
from what is currently the practice or in use.
MR. ORNSTEIN: We will discuss it, and then we
will get language out and write it into language.
MS. PELTZ STRAUSS: Okay. If you remember the
testimony presented on closed captioning, one of the
things that was shown was that digital technology can
enable people to -- caption viewers -- to be able to
control the size of the captions on their television sets,
possibly the location of the captions. This
recommendation would basically be just saying to
broadcasters, take full advantage of the new digital
closed captioning technologies when transmitting
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programming containing such closed captioning.
The second recommendation would be that during
the transition from analog to digital television that
broadcasters ensure the captioning of both analog and
digital programs. Let me just add that this is all taken
with the understanding that this will not change in any
way the closed caption requirements that are in place at
the FCC. And it does not supplement those requirements in
any way -- at least not this. The voluntary code gets
into that a little bit, but this is really just with the
understanding that those requirements already exist.
There is an Act that was passed in 1990, called
the Television Decoder Circuity Act, that required that
new television technologies, including digital television,
be capable of transmitting closed captions. So,
basically, the second recommendation just says that during
the transition, make sure that the captions pass through.
As a corollary to that, I want to add that
Frank's suggestion -- and everybody's suggestion here --
that we require -- incorporate must-carry obligations,
that those must-carry obligations should also ensure that
the closed captioning be transmitted along with the
programming that must be carried.
Okay, the third item talks generally about the
ancillary and supplementary services using a portion of
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the digital spectrum, and just recommends that in
providing these additional services that the actual
provision of these services does not impinge upon the
bandwidth that is currently set aside for captioning.
Again, not creating any new obligations, just ensuring
that the existing requirements for captioning to pass
through continue to be passed through.
The next item talks about the delivery of
services in addition to programming. And it gets at what
Charles had mentioned before, which is the transmission of
data and other -- the transmission of digital streams of
information. Because digital technologies will be so
flexible, broadcasters should offer text options for
material that are presented orally and audio options for
material otherwise presented visually.
Basically, this is just kind of a catch-all,
saying that where there are other services, additional
services provided through digital technologies, that
efforts should be made to make those accessible to people
with disabilities.
MR. DUHAMEL: Passing the digital through, that
is probably not a problem. Making it oral, somebody has
got to do that.
MS. PELTZ STRAUSS: Right.
MR. DUHAMEL: That is adding at least another
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several people as a requirement.
MS. PELTZ STRAUSS: Yes, I agree. It is not
something that is going to happen by itself. There has to
be an effort made to make the information accessible.
MR. DUHAMEL: Well, I don't think that is just a
blanket deal that I accept. I do not know about everybody
else, but that is an additional cost item.
MS. PELTZ STRAUSS: It may be.
MR. DUHAMEL: It is one thing, the closed
captioning, and saying that you are passing the data
stream through and that you can read it. That, I don't
think, is the problem.
MS. PELTZ STRAUSS: Well, I do not know whether
you want to discuss this now.
MR. DUHAMEL: Yes, I think we should. I wish
you would have provided us a copy of this beforehand,
Karen. I have never seen this.
MS. PELTZ STRAUSS: Well, I learned that I was
going to be doing this when I arrived today. So this is a
surprise to me, as well.
Now, there is a draft that is available that
Karen worked on and some other people at NTIA. But I do
not know whether it is still in the working, whether we
want to --
MR. MOONVES: Now, Karen, is this the only thing
170
that is new, that is not currently provided for, that will
in fact goes beyond existing performance.
MS. PELTZ STRAUSS: That is probably the only
thing in here -- well, in a sense, some of the other
things are new. This is probably -- let me finish the
last one, just to show you what I am saying. The last one
basically talks about video description, and says that the
committee recommends that broadcasters allocate sufficient
audio bandwidth.
Well, that is new. Because that has not been
done either. It asks broadcasters to take advantage of
new digital closed captioning technologies. That is new.
So it is not really the only one that is new, it is just a
little bit different than the other ones.
MR. ORNSTEIN: The two of us did not have time,
frankly, to go through and issue our own recommendation in
this regard. So what we wanted to do was to pull out
whatever was out there and have a discussion of it. And
then we will turn to language, since we have gone through
and ironed out these issues, that we were going to
incorporate into our recommendations.
MS. PELTZ STRAUSS: And actually I will say that
this is not new to the committee. This was presented in a
document that I distributed on at least two occasions
before. So while I am presenting it now again, it is not
171
new.
MR. DUHAMEL: Except for I don't remember the
digital stream being on that.
MR. MOONVES: Well, once again, Karen, an
important part is how are these things worded, how we word
these things.
MS. PELTZ STRAUSS: Right.
MR. MOONVES: In terms of the video description,
you are saying use the current technology. Are you saying
that is mandatory? Is it voluntary? I know you would
like to make it mandatory, but I don't think it will work
right now.
MS. PELTZ STRAUSS: I think that some of these
do need to be mandatory. Passing through captions during
the transition from analog to digital is one that is easy
to make mandatory. Requiring that broadcasters ensure the
pass-through where ancillary and supplementary services
are provided could be mandatory.
MR. MOONVES: They are basically extensions on
what currently exists.
MS. PELTZ STRAUSS: They are extensions,
exactly. But they are clarifications.
MR. ORNSTEIN: They are protecting the existing
mandates.
MS. PELTZ STRAUSS: Right. The same for the
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must-carry. I guess there is a question as to whether the
committee wants to say that -- I mean asking broadcasters
to take full advantage of new digital closed captioning
technology, it is kind of hard I think to make that
mandatory. It is more of a recommendation, please do
this. There has to be some flexibility built into that,
because there will be different technologies out there.
MR. MOONVES: I think that language is rather
unclear. I think it can be in the form of a
recommendation.
MS. PELTZ STRAUSS: Right. Well, it is an
ultimate recommendation.
MR. MOONVES: But it is rather muddy.
MS. PELTZ STRAUSS: The video description,
recommending that broadcasters allocate sufficient audio
bandwidth for the transmission and delivery of video
descriptions, and to develop a consistent and reliable
audio standard so that the blind and visually impaired
viewers can benefit fully from broadcast programming; that
is the way it is drafted now.
Again, I think that that is a recommendation. I
would love to see it become a minimum requirement. But I
think there has to be -- because it is not yet developed,
there has to be some flexibility built into that.
MR. ORNSTEIN: Yes. Let me suggest that what
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may work here is a requirement that one set aside the
audio bandwidth, which is going to be a minimal amount of
bandwidth, to take advantage of it, it seems to me is
perfectly appropriate.
MS. PELTZ STRAUSS: Right, and it is a minuscule
amount.
MR. ORNSTEIN: We might, in addition, urge
broadcasters wherever possible to apply these technologies
and make them available on their programming. And then I
think we should not mandate that they be universally
applied. I think it would also be appropriate for us to
recommend that whatever revenues we bring in for public
interest purposes that as they are allocated for these
various purposes, one of the things that should be on that
list would be providing funds to supplement the
dissemination of video description.
MS. PELTZ STRAUSS: Yes. And actually I was
going to add to that. Because since that is one of the
concepts that has been created since I put together my
original proposal, I would also like to see a portion of
those fees go for closed captioning of exempt programming
that affects local community and political discourse.
Because unfortunately, as I mentioned in the past, that is
excluded from the closed captioning regulations. So
PSA's, local political candidate ads, political debates,
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that would be yet another recommendation.
MR. DUHAMEL: It is hard to do when it is live,
closed captioning them live.
MS. PELTZ STRAUSS: Closed captioning is
frequently done live. It is not at all difficult.
MR. MOONVES: Yes. If you go into a bar at a
football game, they often do it. That is live.
MS. PELTZ STRAUSS: It is called real-time
captioning. And it uses live stenographers.
MR. DUHAMEL: Yes, but that is an expensive
deal. In South Dakota, we estimate a million dollars a
year for live captioning.
MS. PELTZ STRAUSS: Live captioning is cheaper
than prerecorded captioning.
MR. MOONVES: Bill, the recommendation is that
it comes out of other funds. It is not going to come out
of the broadcaster's pocket. It is going to come out of
these other funds.
MR. DUHAMEL: It is not cheaper in the small
station to do it. Closed captioning is much cheaper,
because it comes off the prompter.
MS. PELTZ STRAUSS: It depends on where you are
doing it. But live captioning can be cheaper if it is
done by remote interpreters who are sitting in their home
and providing the stenography via a phone live.
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MR. ORNSTEIN: If we build in a recommendation
that funds that we hope will be -- the large pool of funds
available for public interest purposes, that these be on
the list of things that ought to be perfectly appropriate.
I would guess also, Karen, given what is happening with
technology, aren't we moving to a time where probably by
the time we get digital out there, computers will be able
to do this with voice recognition software.
MS. PELTZ STRAUSS: That is exactly right.
MR. ORNSTEIN: And so we are not going to be
talking about it as being the same thing.
MS. PELTZ STRAUSS: That is right. That is
where we are headed. I mean speech recognition at this
rate, hopefully in the next few years, is going to be used
extensively, especially for live newscasts.
MR. DUHAMEL: Yes, because that would go just
the other way. Live newscasts or political debate, they
could put it back in as the closed captioning.
MS. PELTZ STRAUSS: Right. And that is all I am
talking about. I am not talking about open captioning, I
am talking about closed captioning.
MR. ORNSTEIN: But if that is workable to
everybody, that we simply urge -- that we set aside the
audio bandwidth, we urge that it be spread out as much as
possible, and we recommend that expansion of the use of
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this technology for both video and audio for other kinds
of programming be on the list of things that are there
with the use of those funds. Does that reach
acceptability with everybody?
MR. MOONVES: Does anybody have a problem with
that? A comment?
MR. RUIZ: This would be required of all
broadcasters?
MR. MOONVES: Yes.
MS. SOHN: Are you comfortable with that? I am
not really.
MS. PELTZ STRAUSS: Well, you were just talking
about that one aspect. You are talking about using some
of the fees for PSA's and other political candidates and
political issues. Yes, I think that that is, at this
point, what we can get.
MR. MOONVES: You are not going to get mandatory
video description right now.
MS. PELTZ STRAUSS: I will be honest with you.
My original proposal, part of what I included in here was
that -- England already has legislated requirements for
video description. And they are fairly minimal
requirements, given that captioning is in this country.
But basically the video describes 10 percent of all their
programs over the next 10 years. And I recommended that
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we recommended that that be instituted here. And I would
love to see that.
MR. ORNSTEIN: In the spirit of pragmatic give
and take which is infusing our committee across the
board --
MR. MOONVES: We are going to recommend that
they do more than 10 percent.
MS. PELTZ STRAUSS: Right. There are two
drawbacks. One is what you just said. And given what has
been undertaken here, I did not think that I would get it
through. And the other is that maybe it is too low.
Maybe we can go for more.
But I do think that it would be very, very
helpful for this committee to recognize video description,
because it is still in its birth.
MR. MOONVES: I think you are 100 percent right.
MS. CHARREN: It is very exciting.
MS. PELTZ STRAUSS: It is being done by public
television stations. And it is very successful.
MS. CHARREN: WGBH started it, and it is a very
exciting thing to watch.
MS. PELTZ STRAUSS: But to date it is only
public television stations that carry some programming
with video description. And the biggest problem now is
that it is competing for space on the SAP channel, the
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second audio programming channel. And so it just has not
taken off. That is simply not going to be an issue in the
digital age.
MR. ORNSTEIN: We just need to make sure that it
is set aside for whatever bandwidth is required for these
things, and that the manufacturers create the
opportunities.
MS. PELTZ STRAUSS: That is right.
Now, I am hesitant to raise this, but I am going
to raise it because I promised this person that I would.
And I think that you have been contacted by this person
also. So I just have to go ahead and do this. There is a
person from the National Association of Radio Reading
Services that has been contacting me. And perhaps this is
something small enough that we can just put this through.
He has asked -- let me give you some background.
And this is short. Radio reading services throughout the
country basically provide the reading of newspapers,
periodicals and books. And they provide it over
subcarriers on public FM radio stations. But the
transmission over the subcarrier is being threatened by
other interests that want to lease the space that is
currently being used by the radio reading services.
Also there has been some problem with the
transmission of this information on analog audio
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subcarriers because there has been a lot of interference.
This entity, the National Association of Radio Reading
Services, has requested that we recommend -- he put down
"mandate" -- at least 60 kilobits of each DTV signal to
deliver the radio reading services material.
The reason I am presenting it is because I have
been asked to present it. And also, is it so minuscule
that it is something that we could recommend, along with
the emergency access?
Take a deep breath, Les.
MS. SOHN: How much of the DTV signal?
MS. PELTZ STRAUSS: He had asked for 60 kilobits
of each signal.
MR. DUHAMEL: What is that?
MS. PELTZ STRAUSS: I do not know what that is.
MR. CRUMP: When we get to the point here, we
wonder why the NAB gets upset. I mean we just go on and
on and on and on.
MR. MOONVES: Karen, are we going to do
something on local theater next?
MS. PELTZ STRAUSS: No.
MR. MOONVES: It is radio. It is radio. That
is not our charge.
MS. CHARREN: And we are not doing radio. There
is a lot of things we could say about radio, but we are
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not doing radio.
MS. PELTZ STRAUSS: Well, I think what this
person's point is -- and this will be my last sentence on
this issue -- is that there is an opportunity here to
provide these services to blind people. And since it is
such an enormous amount of bandwidth, they see this as a
possible way of getting through the information.
If you think that this is not the forum, then I
am going to drop it now. But I had to bring it up.
MR. MOONVES: Any other comments?
(No response.)
MR. MOONVES: Okay. Jose Luis, would you like
to talk about -- oh, wait, yes, go ahead.
MR. ORNSTEIN: This is obviously an area which
does not bring unanimity to us, but it is one in which
people feel quite strongly on both sides. And the basic
point here I think is that we should confront first the
question of whether the model of public interest
obligations that has developed over the years since all of
this began works well as it stands, is something that we
should just take and move to the digital era, or whether
over the long run, given that we are going to see dramatic
changes in technology that are going to drive changes in
the way in which we communicate -- some of the issues in
which we have been discussing, like whether if you have
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six channels or eight channels or 10 channels the same
public interest obligations that apply equally to all of
them or in different ways -- that a model that brings it
much greater flexibility, including a flexibility to take
resources and allocate them in different ways across
communities to satisfy different community needs, and to
respond to the need for flexibility would be a better one.
We have had some discussion of a variety of
different models. And of course out in the world we see
models -- and the application of different models now
applied -- in a whole host of places. In the area of
pollution, we have moved from command and control
regulation more and more towards a kind of marketplace
model, with effluent taxes and credits, and the trading of
such things. That is really the basis in which, if there
ever is an agreement on global warming, it will come
about. And we certainly see it working in other places as
well.
And a lot of people out there have been trying
to step back and rethink the whole nature of the public
interest and broadcasting into the future. We had a whole
series of models presented to us through the Aspen
Institute independent working group. And clearly the one
that keeps coming back -- with different variations -- is
one that was suggested many years ago by Henry Geller,
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basically. And that is what has been called, for
shorthand, pay or play.
And it really is to provide the options that you
can continue to do what the existing or future regimen of
obligations provides or pay through some formula to
discharge many of those obligations. Not obviously
statutory ones, not obviously things like closed
captioning, but those other obligations.
MR. MOONVES: Closed captioning and children's
programming.
MR. ORNSTEIN: And then use those revenues for
public interest purposes appropriately. What Henry has
also suggested is that if you decided to move in that
direction, to pay, that you would have an expedited
license renewal process as well.
So I don't think we probably should in our
report get into great detail over the specifics of any
particular model, but recommending that looking down at
the road at this fast-paced and changing world, a
different model, a flexible one like pay or play is
appropriate as the direction in which we thought we ought
to go.
So let's open that up to discussion.
MR. DILLER: I would agree. I just think the
concept of pay or play is a bad idea. It is bad business.
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And I think we talked about minimum standards, guidelines,
to meet your public interest obligations. And I don't
think there should be a kind of having a second stand-in
for those obligations. And I also think that I would
worry about what you would pay. Where would this money
go? And what would actually happen to it?
If in fact there is a relationship between
having a license that you obtain for nothing, which has
minimum standards attached to it for public interest
responsibilities, you should simply meet them and shut up.
So I think pay or play is a foul concept.
MR. LA CAMERA: Norm, you have heard from me on
this concept before. And to quote from your document, on
page five, you discuss high standards of public service
that most stations follow and that represent the ideals
and historic traditions of the industry -- that
phraseology, to me, is mutually exclusive from any concept
of pay or play.
MS. SOHN: I am glad to be foul. I think our
whole deliberations over the year really demonstrate the
pay or play concept is a really good idea. And it is an
idea whose time has come. If you had asked me last
October whether I would agree to something like this, I
would have said absolutely not.
But when we have resistance from broadcasters to
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setting the most minimum standards, it says to me that
there is some portion -- nobody sitting around this table,
I will reiterate again -- some portion of broadcasters
that do not want to do public interest programming. And
if they are forced to do it, they will do a crummy job.
So why not give them the option of paying it away and
giving it to somebody who will do a good job?
I just think it is an idea -- you know, Barry,
if all broadcasters were like you, I would agree with you
in a heartbeat. But they are not. And the debate we have
been having over the last year demonstrates to me that,
let's pay somebody else to do it. I think it should be a
fee tied to gross receipts from the advertising support
services. If you do not want to go into that kind of
detail, that is fine. But I think we need to get it out
here. And, frankly, I think it is the most important
concept that we could throw in the air.
The idea is we have got to look at a new
approach. And I think this is a good one.
MS. SCOTT: I remain to be sold by either side.
MS. SOHN: But the great thing about this is you
have a choice. If you want to be the broadcaster that
takes public interest responsibility seriously, do it, you
do not have to pay. But if you are going to do home
shopping and you are going to do stuff that just does not
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even vaguely -- no, no, no --
(Laughter.)
MS. SOHN: If anybody has a fork, I am going to
eat my foot right now.
(Laughter.)
MS. SOHN: And I know you are changing away from
that.
MR. DILLER: First of all, I think it is bad
usage of the airwaves. And we are as quickly as we can
converting out of it. But these stations, even while they
do home shopping, which can be argued how much it is done
well, it certainly is a service for the public. And I
would not be at all defensive about it.
But these stations meet their minimum
requirements of public services programming. Take home
shopping off the air and replace it with a lot of the
programming you spoke of earlier that is sitting on
various people's shelves that is of good quality, either
educational for kids, et cetera, et cetera.
In other words, what I am saying is even home
shopping, which allows people to ghettoize the whole
concept, even that does minimum standards for getting its
license. I do not know how you quitclaim that.
MS. CHARREN: What about the idea that if we
would just talking about a one-for-one switch, then what
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you say, Paul, I agree with. You know, broadcasters are
broadcasters, and that serving the public interest is
something they have attempted to live with for years. But
we are talking about a different landscape, with six
channels, where there is one, at least when there is
multiplexing.
And doesn't that change the sense of what can
happen on those six channels that could increase options
for the public without really serving the public
adequately with the kinds of things that we want to
mandate, and that there are other ways to deal with some
of those channels, in contrast to what we called the
primary channel before? Doesn't that change the ball game
a little bit?
MR. LA CAMERA: It changes the ball game for
every consideration we have had in this document. I mean
it is a very different world and environment than it was
when you and I first started working together a quarter of
a century ago. But that does not undermine or negate the
basic principles and idealism which I still believe are at
the root of what we do. And that is why I have such
difficulty embracing the concept that you can, as in the
Civil War, buy your way out of it.
I just have been around and done this too long
to evolve into that mind set.
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MR. ORNSTEIN: I am sensitive to that. And of
course we had the same thing with the pollution issue. It
is a question of what moral tone you set, in part, against
what works most efficiently to achieve the goals. And it
is difficult. And it is particularly difficult in a
changing world of broadcasting, where a lot of the new
broadcasters coming in do not start with a deep-seated
sense of public trusteeship. What do you do to avoid
losing a lot of that?
But you have other questions here, too. Let me
address a couple that Barry has raised. Clearly the key
to this is what happens to the money. And if the money
goes down the toilet or is used inefficiently, then you
have lost something very valuable for nothing in return.
And that is certainly very important.
But you have another question here. Most of
what we have in terms of -- I mean, you know, you can
build some flexibility in the minimum standards. And we
are not just talking about minimum standards, we are also
talking about other obligations that exist now without
mandatory minimum standards. Mostly it is a
one-size-fits-all phenomenon.
It is everybody required to do pretty much the
same thing. And that means a tremendous inefficiency
across the board.
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MR. DILLER: That is why there should be
flexibility.
MR. ORNSTEIN: You have got to build in as much
flexibility as possible. One way to build in flexibility
is at least for some of these things, if instead of doing
them you pay, and then you can use those resources to
allocate most efficiently to create in fact a better
environment.
MR. DILLER: It is impractical. You are slicing
the salami in too many ways. I will do this. I will give
$1.75 because I would rather that than this. I will put
that over here. What you should do, as you say, is you
should have real flexibility in how to meet the minimum
requirements -- hopefully exceed them, and be judged on
that.
MS. CHARREN: What about one of the channels for
the public interest? That is sort of clear.
MR. DILLER: Again, the question is what do you
do with it? I mean what do you actually, in real,
practical, pragmatic terms, what do you put on it?
MS. CHARREN: Well, you could say the same thing
about the mandatory standards.
MR. DILLER: No. Because if you have -- for
instance, what you want to do, because you have got news
resources, La Camera's news resources, he wants to put on
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24 hours of news because he thinks it is a real public
service to do so. That is fine.
MS. CHARREN: He can still do that. He does not
have to choose the public interest station.
MR. DILLER: What I am saying is that if you are
saying one of the areas of flexibility to meet your
requirements would be that, fine, who cares. The issue is
flexibility, so that people use their talents and
abilities and resources in ways that actually contribute
something, rather than things that are written down on a
rigid piece of paper that may not produce the same
valuable result.
MS. CHARREN: And one of the actions is taking
that public interest station and giving it away, and
relieving yourself of some other obligations. No?
MR. MINOW: Remember that line in the movie,
what we got here is a failure to communicate? Take the
first sentence that Barry said at the beginning. He said
if a broadcaster meets the minimum public service
standards -- that is the if. The issue is what about the
broadcasters who do not?
MR. DILLER: Take their license away.
MR. MINOW: Take their license away?
MR. ORNSTEIN: That may be more impractical.
MS. CHARREN: Yes, right.
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MR. MINOW: But that is the question. If the
broadcasters -- and you heard from many of them here this
morning -- we do not want any minimum public service
standards. We just want to play. We do not want to pay.
We just want to play. What do you with them?
MR. DILLER: Well, it is an absurd concept.
MR. MINOW: I agree with you.
MR. DILLER: How are you ever going to be able
to maintain, on any level of equity, that you are going to
get a license for nothing, and that is it, period, do
whatever you want?
MR. MINOW: I agree with you.
MR. DILLER: So since that is absurd, you have
to put in its place something. And there seems to be
general agreement on what would make up a body of minimum
standards. If somebody will not meet the minimum
standards, and there is a process for going through it to
determine that, then they cannot have their license. Why
should that be such an impossible thing to have as a
functional, practical process?
And what do you replace it with if in fact you
find them or you have them pay penalties for not doing A
or D or Q or Z? That does not make any sense.
MR. ORNSTEIN: Yes, Frank.
MR. BLYTHE: I had a conversation with an
191
employee of a station in Lincoln one day. He was telling
me that they were just recently going through an ownership
change. And a company that is not even in the broadcast
field is buying the station. And the word is out that
everything is going to be pretty much the bottom line, and
a lot of budgets are being cut, particularly in the area
of public affairs programming and community outreach
programming and staff for that kind of thing. Which just
indicates to me that -- you know, in this whole process of
things that are happening in the industry -- that the new
ownership may or may not be in touch with their
communities.
It is just one of the small reasons why I
support the pay or play concept, because it is just
another option, and I think part of the flexibility we
have been talking about here. There are going to be
stations out there that really do not have that much care
about what their image is or what their service is in the
community. And whatever group that number is -- and I am
not sure what they are; I know we asked for some
information on that -- but it just seems to me that this
fits the concept.
And also it is one of the few I guess new
approaches to a revenue stream for educational
broadcasting that we have not really figured out. Well,
192
we are proposing all these educational channels, but what
is going to support that kind of activity in terms of
programming and services in that arena, whether it is
public broadcasting, PBS or just educational channels in
general?
So I think the pay or play concept is a valid
one to make a recommendation on in this report.
MR. CRUZ: I think the uncertainty I guess of
this particular proposal, this new approach to public
interest obligations, the uncertainty lies in the realm
that we do not know, we cannot forecast, four or five
years down the road, if a given network has four or five
other channels that they are using for highly successful
money-making operations that do not even call for any
public interest obligations in that realm. Let me just be
hypothetical.
Let's say that a station were used solely for
soap operas, sunup to sundown, and it became an enormous
hit. I am just speaking hypothetically. Around the
clock. And there was no other opportunity for that
particular channel of that particular network to meet any
public interest obligations. Is that an opportunity for a
pay or play, and say because we are very successful with
this soap channel --
MR. GOODMON: Why do you say the soap channel
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cannot run PSAs, do public service programming, allow
candidates to appear, why do you say the soap channel
cannot do that? I mean every station can do that. MTV
has public affairs. I mean the religious channels have
public affairs programming and PSAs. I do not know why we
are ruling that out. I do not know why you are saying
they cannot do that.
MR. CRUZ: No, I am just saying -- no, that is
why my point is of the uncertainty that we do not know,
four or five years down the road from now, ABC or NBC or
somebody else, CBS, may say, gee, there is one channel
that we would like -- it is so successful, with nothing
but football around the clock, classics and reruns of
Superbowls and whatever, plus other stuff, that we are not
going to have time.
MR. MOONVES: Frank, the argument is, at
half-time, you could put on a PSA of that football game.
MR. DILLER: There is no program format that I
know of that would an antisocial channel.
(Laughter.)
MR. DILLER: Other than that, there is no
program format that I know of that would not normally run
a minimum set of public service obligations.
MR. ORNSTEIN: We have got 22 of those already.
Right.
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MR. ORNSTEIN: But nobody is suggesting that
they would be precluded from doing this. The idea here is
that if you had an all-soap channel, you could, if you
wanted, put on PSAs, do political discourse and the like.
But if you did not, you could pay what one would hope
would be a significant amount of money that could then be
channeled into public service.
MR. MOONVES: How much?
MR. ORNSTEIN: Well, I can tell you what Henry
Geller has suggested. Which is what, 2 percent of
revenues, plus 1 percent transfer fees. It is 3 percent.
MR. DILLER: If you think about it, that is an
absurd concept, 2 percent of this, 1 percent of this. I
mean that really makes -- you know, is that really the
value of public service? Is that the value of your
license? Is that how you quantify the value of your
license that you are getting for free? In return, you are
quantifying it to 2 percent of X? You do not even know
what X is. I mean it is just a loony idea.
MR. CRUMP: One of the concepts that has made
television -- and going back to radio when it first got
started -- work so that we would be successful in what we
did was the involvement of the audience. That is why
television is so successful today. That is what the
political candidates do not want to give up their
195
advertising. Because we talk to people in their homes,
face to face, live, in color, here we are. DTV is going
to make it look even more realistic.
All right, so you have got a soap channel,
Frank. And here it is. You are missing a wonderful
opportunity here to try to tie these people closer to you,
by putting on things that are aimed specifically at that
demographic group. They are probably going to be mainly
female. And so you have the opportunity here to talk to
them. That is what we have. That is our demo. That is
what we go for.
And so you have the opportunity to give them
public service as far as medical situations are concerned,
as far as what their interests would be, whether it be a
business interest or whether it be a home interest. And
all you are doing at this point, if you are really good at
what you do -- in our business, we think -- is, to some
extent, exploiting what you have got, but you are
exploiting it in the right way because you are making them
want to come back and you are making them think that you
are more important in their lives in what they do on a
daily basis.
MS. CHARREN: Divorce counseling for soap
operas.
MR. DILLER: Battered wives.
196
MR. BENTON: In fact, I think this is why it was
so interesting when in the early briefing -- I think it
was NAB or a NAB-related lawyer -- was reviewing the
public interest in broadcasting history, left out the
single most important case in public interest in
broadcasting, which was the WLBT case. Which was, Barry,
the one time in my recollection that the FCC actually did
revoke the license because of the racist programming,
which was antisocial programming, in Jackson, Mississippi.
So that has only happened once in history. So
the problem of holding broadcasters accountable at the end
of the day and taking their licenses away in actual fact
has only, to my knowledge, happened once. You have got
now the much longer renewal cycle, the nine years, all
these problems. So this is not a totally crazy idea. And
I think that the issue that Newt has raised, which is what
if -- for those broadcasters that do not meet these
minimum standards that hopefully we will be able to
develop as a quid pro quo for must-carry as we discussed
this morning, for those broadcasters that do not meet
these minimum standards, what happens?
And that is the root, I think, of Norm's --
MR. DILLER: Auction the spectrum. Simply
auction the spectrum. If that is your attitude, auction
the whole spectrum, and let it go at that. Because you
197
cannot drive the line through the middle of it.
If you say on one side that nobody is going to
hold anybody to account for getting the free license and
doing the quid pro quo necessary, the only other
alternative is auction the spectrum, and let everybody do
what they want. In which case you do not have free
broadcasting. In which case the whole tent collapses.
But if you are not willing to go through any
process, if you are not willing to have minimum standards
and if you are not willing to go through any process
whatsoever to determine whether or not they are met, the
whole thing is a charade. And then I will switch course.
MR. CRUMP: Well, let's remind ourselves,
Charles is correct, that we only had one license taken
away. But I would remind you that time and again,
unfortunately -- and it embarrasses me as a broadcaster to
remind you of this -- that there have been many, many
times when stations were cited and their licenses were
about to be taken away because of all sorts of problems
that they had engendered and caused themselves, and what
the FCC did was step in and have them correct them within
the given limit of time or else those licenses would have
been taken.
And in most instances, at least to my knowledge,
it was a change of life situation for the owners, because
198
they suddenly thought, oh, my God, I really got caught and
here we go, and things did change. So there has been some
enforcement far beyond the one jerking of the license.
MR. YEE: The challenge of a license and
litigation, it is a prolonged, protracted affairs. I mean
I am from the Bay area, and one of their second stations
was challenged for a long, long time. And to watch that
process, and then it was given to another group, and to
see that totally undercapitalized, under-used because of
the funding problems, I think it just -- you know, we need
to come up with different ways of challenging our own
thinking.
And I think the flexibility of the pay or
play -- it could be a Faustian deal, I agree with you on
that -- but this can help to address some of the concerns
about where is the content going to be coming from. And I
think this is the way of trying it out. If it does not
work, then I would definitely go along with some of the
other recommendations of making the stations more
accountable. But we have to find a way of trying to get
off from where we are to try something new.
MR. MOONVES: I think we have heard from just
about everybody on this panel on this issue. And clearly
there is a real division. I think this may be an issue
where there will be two diverse sides written up, because
199
I don't feel like there is a consensus either way here.
MR. BENTON: Les, can I add another separate
point, but it fits into this deregulatory framework
section of your paper. In my letter to you, my fourth
point was the suggestion of an ongoing review mechanism.
I said here very briefly, finally, we should recommend
that an ongoing leadership group, such as our committee,
be established to monitor and report annually to the
President, Congress and the general public on the digital
television broadcasters' performance on their public
interest obligations, with the understanding -- as Norm
has stated -- on, quote, the digital age --
MR. MOONVES: I will not be on that committee.
Charles, feel free.
(Laughter.)
MR. BENTON: -- the digital age requires
flexibility by regulators and broadcasters alike. I am
not stating what the mechanism should be.
MR. MOONVES: No, the mechanism is revocation of
your license. That is a fairly strong -- it will put you
out of business.
MR. ORNSTEIN: Charles is suggesting that we
should have a recommendation for some kind of review
process to assess what is happening in the digital area.
MR. MOONVES: Oh, I see.
200
MR. BENTON: Right. And we should.
MR. MOONVES: Yes. Okay, that is a good point.
MR. BENTON: That is the point.
MS. SOHN: And I recommended that the FCC do
that. Well, that the FCC review and modify their public
interest obligations. I think you are talking about more
of an oversight and some kind of empirical evidence --
broadcasters are doing a good job, broadcasters are not
doing a good job -- that is not what I had in mind. You
know, maybe they can be sort of combined in that regard.
MR. BENTON: Well, we are trying to set
standards. We are trying to help move the process
forward. And we are talking about the public interest
obligations. But at the end of the day, we are going to
go out of business, and it is performance that really
counts -- what actually happens -- and then who is
evaluating what happens.
So you were mentioning the news organization
earlier -- the News Council -- I do not know what the
mechanism is, but it seems to me that an ongoing
mechanism, independent mechanism, of review, to look at
the performance, vis-a-vis the obligations -- this is very
important. Otherwise, you know -- and this is so -- that
is the reason I raise it. And I think it should be added.
That is my whole point.
201
MR. MOONVES: On this issue, as I said, I think
Norm and I will discuss later on -- we will approach some
of you to write up the various viewpoints on this. And we
very likely will have two different reports on this issue.
That is my guess.
MR. BENTON: Yes. My final quick point is
your -- going back just for a moment to the political
discourse, pages 7 through --
MR. MOONVES: We are past there. We are on to
the next.
MR. BENTON: No, I understand that. Pages 7
through 10 of your memo. It has a lot of wonderful ideas,
none of which I am opposed to in principle, but all of
which we cannot do. How do we determine the priorities
here? We have not focused on what the priorities are
here. Because there are a lot of wonderful ideas here.
None of which I am opposed to in principle. And I just
wanted to raise the issue of how do we deal with -- are
there any of these points that are raised on pages 7
through 10 that anyone disagrees with strongly in
principle? Because, if so, I have not heard it.
Therefore, if that is the case, how do we sort
out the priorities? What are the thoughts on this?
MR. ORNSTEIN: I am not sure that we will sort
out priorities here. I think what we wanted to do was to
202
put out, first of all, our larger point about political
discourse.
MR. BENTON: Right, a wonderful four pages.
MR. ORNSTEIN: And set out several areas which
should be done or could be done. That is going to have to
be left to the political process.
MR. MOONVES: The operative word was
"flexibility" once again, different options on the menu,
pending campaign finance reform, tied to that.
MS. CHARREN: Is there some way to write that so
that it looks like options instead of just paragraphs?
MR. ORNSTEIN: Sure.
MS. CHARREN: You know what I mean, you know,
bullets or something, so that even though we do not
recommend one over the other, at least we know what we are
talking about.
MR. ORNSTEIN: Yes.
MR. MINOW: If you have got a couple of minutes
for me to give you a narrative of what happened on the one
television station license that was taken away and why?
MR. ORNSTEIN: Yes.
MR. MINOW: When I was chairman of the FCC in
the early sixties, Mrs. Eleanor Roosevelt called me one
day.
She said, why aren't you doing something about
203
Reverend L.B.T. Smith? I said, I'm sorry, Mrs. Roosevelt,
I do not know what that is. She said, well, he wrote you
a letter and you didn't respond. I said, tell me about
it, Mrs. Roosevelt. She said, well, he's a black
candidate, a minister, in Jackson, Mississippi, who is
running for Congress against the incumbent, John Bell
Williams. There is no discussion at all on the television
station about the election. So finally he raised the
money and he went to the station and he said he wanted to
buy a little time. And they said, come back next week.
He came back next week, they said, come back next week.
This went on for six weeks.
Finally, Mrs. Roosevelt said, the election is
next week. So I checked in the files of the FCC and sure
enough there was this complaint somewhere in the basement.
I said, what is this all about? And they said, well, the
station says they are not going to sell anybody any time
or cover the election.
And I said, I don't think that is going to
happen. So we called the station. He got on the air. He
lost the election. John Bell Williams, who was the number
two senior Democrat on my committee that supervised me
gave me hell. But eventually the license was taken away.
Now, that was a long time ago. So I say to you,
Barry, it happens. But the FCC itself is at fault here,
204
through the years, for not policing the territory.
MR. DILLER: I agree with that, and I have said
it publicly for some time now.
MR. MINOW: So I think it is interesting to get
a context and history of why and what happened. And that
is the story of WLBT.
MS. SOHN: I will just be very brief. Charles
mentioned the eight-year license renewal. That is one
thing that makes that kind of enforcement even more
difficult, Newt. But another thing that has not been
mentioned is what Congress also did in the 1996
Telecommunications Act, and that is institute what is
called two-step renewal. So, basically, unless you have
shown the FCC that you have engaged in a pattern of bad
behavior, you get automatic license renewal. So I think
that makes it even more difficult and bolsters the case
for pay or play.
MR. DILLER: And it bolsters the case for an
invigorated FCC review of these issues. That is what it
bolsters. Because it is impossible, I think, to argue
that you should have must-carry status unless you link it
to minimum standards and you link minimum standards to the
fact that they are generously upheld by the license
holder. And unless you do it, you have got no chance to
protect the circularness of free broadcasting.
205
That is why I think it is so dangerous to get
into paying in some concept of I won't do this so I'll pay
you that.
MS. CHARREN: If you are going to do it that
way, which is theoretically the way it has worked for
analog for the last 40 years, there have been a whole lot
of public service components that have been missing from
the service of enough broadcasters, so it feels like it is
missing across the board, except often with public
television. You are not going to have an FCC that really
monitors that aspect of serving the public with a variety
of different kinds of things.
How do you deal with the fact that across the
board broadcasters can still be meeting those minimum
guidelines and not serving the needs of a public in a
digital age? Whereas when I thought about what was coming
with all these channels, I thought finally we have the
opportunity to provide enough choices and enough diversity
and enough of what is missing to serve the public in the
digital age. And I thought that -- it was in that context
that I thought that pay or play made sense.
I understand what you are saying. But it seemed
to me that that made likely the filling the holes of what
is not there. And I just cannot see the same rules
applying and it working any better for certain aspects of
206
the public interest than it has worked in the past.
Assuming we get the FCC off its -- you know, paying
attention.
MR. LA CAMERA: I still fail to see the logical
connection between pay and play and a breakdown in the
oversight function within the system itself.
MS. CHARREN: It is not an oversight function.
MR. LA CAMERA: It is an oversight function.
MS. CHARREN: But how can you say --
MR. LA CAMERA: License renewal was an oversight
function that occurred every three years --
MS. CHARREN: But how can you say you have to
provide programming to meet the kinds of needs that you
were talking about?
MR. DILLER: But then you are arguing about the
minimum standards not being maximum enough. And that is a
whole other discussion. The question is, what are the
minimum standards that everybody can agree on are the
minimum standards? Some will do more. Nobody can do
less. I mean that is just the nature of things.
MS. CHARREN: But I think legislatively it is
easier to think of giving the money to somebody and
letting them take care of the problem than to start making
rules in a constitutional democracy about what you have to
do.
207
MR. LA CAMERA: We have spent all day talking
about rules and regulations and now, suddenly, we are at
the end and you decide that maybe they are not such a good
idea and we will buy our way out. I still do not
understand the logic of it.
MS. CHARREN: I don't think anybody is saying
that.
MR. LA CAMERA: The issue of the oversight --
and Barry raised it and Chairman Minow did and I think
Frank did too -- first of all, for the record, there were
two other stations that lost their license.
MR. DILLER: KHJ.
MR. LA CAMERA: One in the early 1970s and one
in the early 1980s, uniquely, both in Boston, both major
network affiliates. But this disclosure of public
interest is I think --
MR. DILLER: Certainly the General Tire.
MR. LA CAMERA: WHDH lost it on multimedia
ownership, and then an ex parte contact with the
then-chairman of the Federal Communication Commission.
MR. DILLER: Mr. O'Neil.
MR. LA CAMERA: And then WNAC-TV, which was the
RKO General, lost their license for fraudulent business
practices.
MR. DILLER: Right.
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MS. CHARREN: That was just an expensive lunch.
(Laughter.)
MR. LA CAMERA: But in any event, this component
of the report that deals with disclosure of public
interest activities by broadcasters -- that is why I
thought that was an important step back to reestablishing
some degree of oversight in the performance of television
stations, and a much more idealistic and principled way of
doing than resorting to pay or play. And that is again
the root of my strong feelings, and I think Barry's and I
think James' as well.
MR. ORNSTEIN: This cuts across all kinds of
lines, very interestingly. And we can perhaps make a
contribution here by having a vigorous debate on the pages
of our report.
MR. MOONVES: Correct. All right. Are we done
with pay and/or play?
Jose Luis Ruiz put a report in front of us this
morning. And if you would like to go over the report and
what you would like -- you feel should be entered into our
larger report, why don't we get into that right now.
MR. RUIZ: Okay, just very briefly.
And I agree with you, Barry. I just think that
we have tried to make so many compromises to make this
palatable to everybody that maybe we have lost the real
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teeth of what we were trying to do.
Well, basically, as I state in here, I support
funding for the Corporation for Public Broadcasting to
help PBS make the transition into the digital era. As far
as a trust without any accountability, I have real fears,
and it is not something I could support. I think, once
again, they are wheeling in the educational Trojan Horse,
but it is really funds, a trust, to fund the whole system.
And I think it is very hard to defend the whole system.
I think there are some problems in it. And it
is an opportunity to make it more accountable to the
American public, to the taxpayer. And if it is willing to
do that, then wholeheartedly I would support that trust
for them. And I understand the difficulty of going to
Congress every year. And I understand the vulnerability
of it.
But at the same time, there is a lot of house
cleaning that has to be done with Public Broadcasting.
When a program like Maya Lin is not carried by a station
because the station manager does not feel it has Asians in
its demographics, I think there is something wrong with
that, something morally wrong with that. Maya Lin is a
great American sculptor. The fact that she happens to be
of Chinese ancestry has nothing to do with her.
When you look at their prime time schedule and
210
you see the lack of minority voices and ideas and concepts
and products, there are problems there. If they are going
to use taxpayer dollars, I think they have an obligation
to include all of the American public. And if they are
willing to sign that contract, let's move forward.
I do not know if you just want me to go through
it or you want to talk about it point by point?
MR. MOONVES: On the point that you just made, I
think it would be more helpful if you presented how you
would like this to be incorporated. Earlier on we talked
about the Corporation for Public Broadcasting and their
ability to get funds, and you wanted it to be more open.
In other words, these recommendations, I know they deal
with diversity. How would you like us to incorporate them
into our document?
MR. RUIZ: Well, my feeling is if you are going
to propose this group supporting the trust fund, I am just
saying I cannot do that. So you are not going to get a
consensus.
And the reason why you will not get me to do
that I am explaining to you.
MR. MOONVES: Even with the language that we
talked about earlier? Earlier we talked about language
that incorporated Public Broadcasting. We took out "only"
and "first." And we talked about their ability to open up
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and offer other opportunities, too.
MR. RUIZ: Pertaining to the analog and other
things, I can support that.
MR. MOONVES: Right.
MR. RUIZ: To a trust fund? No.
MS. SOHN: Are we really advocating a trust fund
for CPB? I think we are advocating a trust fund for many
different systems.
MR. RUIZ: No, I read it that you are advocating
for a trust fund.
MR. ORNSTEIN: In our discussion of the
education channel, we started by saying it would be
desirable to have a trust fund.
MS. SOHN: Right.
MR. ORNSTEIN: What if we said in there that we
hope that in the process -- if Congress is able to pull
together this trust fund, that Public Broadcasting show
sensitivity to all the diverse interests of its publics?
MR. RUIZ: No. Because in every one of their
appropriations, Congress has put a lot of different
language in there. And I think it has to be a real
contract as to what are you going to do with it and how is
it going to be spent, and how is it going to affect these
very societies you serve.
Without that, I cannot. Because this is not
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something that has come up in the last year or two.
MR. ORNSTEIN: Okay. Well, what may be more
appropriate in this area, then, is a powerful dissent in
terms of that concept.
MR. MOONVES: Under the education area?
MR. ORNSTEIN: Yes. Or just simply a dissent
that says I don't favor setting up a trust fund for Public
Broadcasting unless the following is done.
MS. CHARREN: But this trust fund is for Public
Broadcasting, right?
MR. ORNSTEIN: Yes.
MS. CHARREN: Not for the extra channel?
MR. ORNSTEIN: Right.
MR. MOONVES: Do you have another recommendation
of where this money should go?
MR. RUIZ: The trust fund?
MR. MOONVES: Yes.
MR. RUIZ: No. I would support a trust fund
if -- CPB, I assume, is going to be the recipient -- will
sign a contract with Congress as to how it is going to use
it. And Congress will police that. And they will come
back and say, okay, we are going to spend so much in this
area, so much in that area and so much over here. And
this is how we are going to improve and streamline our
system. And if they go ahead and do that, that is fine.
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MS. CHARREN: I would oppose that.
MR. RUIZ: That is fine.
MS. CHARREN: I would oppose that because when
Congress opens its mouth about Public Broadcasting, it
very often makes my hair stand on end.
MR. MOONVES: I think we have established that
Jose Luis is going to write a dissenting letter.
MS. CHARREN: Yes. All right. And I accept
that. But I do not want -- well, good.
MR. MOONVES: Unless there is some language that
we would come back to you with that you would find
acceptable. But that may not be the case.
MS. SOHN: What area is he talking about? I am
kind of confused. I agree with you in principle that we
should not necessarily give Public Broadcasting money
without some accountability. But I am not quite sure -- I
am really vague of what areas you are talking about.
MR. RUIZ: I will give you examples. And I
think Frank is absolutely right when he sits there and
says it is very difficult for us to have to go to Congress
every year to get funding. Well, it is very difficult for
ITVS to have to go CPB every year. Is ITVS going to be
written into this language and their funding continued for
the independent producing community? Is the minority
consortia?
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I spell it out in here, some points. Is the
minority consortia money going to be just as guaranteed as
they are asking for their money to be guaranteed?
So if they are performing some services now,
will these services continue? Or will they get their
trust and stop funding the ITVS, stop funding the minority
consortia, stop funding minority producers?
See, without any guarantees of services and
continued services, and growth in services, why should
they be given something without telling us what they are
going to do with it?
MR. ORNSTEIN: Frank, how do you respond to that
last point?
MR. CRUZ: What I think Jose Luis is getting at,
I think he wants to make sure that if the recommendation
is that there be an adequate and permanent source of
funding in the form of a trust fund for Public
Broadcasting, if I read him correctly, he is in essence
saying that he would like some specificity to that trust
fund that certain kinds of either culturally diverse or
other kinds of programming be covered, or be tied to that
kind of funding. That is basically what he is saying.
MR. CRUZ: And it is specifically, not just --
the June 4th document that I submitted of the
recommendations to the advisory committee, on page five --
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I do not know if any of you have it; I have it in my
file -- but it talks about what the trust fund would do
for the digital future -- a variety of different things --
but it says the best way to guarantee and advance the
public interest issues of digital spectrum is to ensure
long-term financial security in Public Broadcasting.
It goes on to say: The fund would support
educational programs for multi-tasked channels, high
definition cultural diversity programming, data services,
and new children's initiatives, new services for
previously underserved audiences, and local public service
programming.
And then it goes on to spell out other kinds of
things. But I think Jose Luis is trying to -- I think is
asking for specificity of certain kinds of programs be
tied to that trust fund.
MR. RUIZ: And I think also, Frank, that the
independent community fought very hard to create the ITVS.
Minority communities have fought very hard to create the
minority consortia. I want to make sure that when the
tide comes in that all the ships are going to rise, and
that those institutions will continue to live, to prosper
and to serve. They are not even mentioned.
MR. ORNSTEIN: What if in recommending a trust
fund we suggest that some share of funds be set aside --
216
of the revenues that would come in that trust fund -- be
set aside -- or the expenditures -- to go to independent
producers and minority producers? How does that sound?
MS. CHARREN: I think that is nice.
MR. CRUZ: I think that is what we agreed upon
earlier today.
MR. MOONVES: Yes, we did. We agreed on that
almost exactly, and other opportunities within that.
MR. RUIZ: Very specifically.
MR. ORNSTEIN: So we will specifically say
independent producers and minority programmers.
MR. RUIZ: And I will help write up something.
MR. ORNSTEIN: Fine.
MR. RUIZ: In education, I think we have covered
that.
MR. MOONVES: Okay.
MR. RUIZ: In the multiplexing and the minority
entrepreneur, I do not know if we are going to have time,
but I can try to present a paper on ways of -- I would
like to present a draft, so that other broadcasters can
see it first -- on ways of incorporating opportunities for
minority entrepreneurs to get into the broadcasting
business. And I think if you are going to multiplex, it
seems to me that somewhere in there, there is going to be
an opportunity that never existed before.
217
And it is going to be a lot less than what we
historically have known, of them trying to have to buy a
station. But it is an avenue I think that could lead to
that eventually. If they are good at what they do and
they are able to grow, I would assume that eventually they
are going to be in a position that they can be a serious
player and actually go after stations -- if the stations
are still around and have not folded because it costs so
much.
MR. MOONVES: As you probably know, one of the
main agendas of the new chairman of the FCC is exactly
that. And he is doing I think everything he can to aid
that.
MR. ORNSTEIN: There is a time problem here,
Jose Luis. But why don't you try and write up some
language in this area that kind of fits within the
framework of what we have all pretty much agreed to in
multiplexing, but that expands it to include minorities.
It is something that would have to be done within a couple
of weeks. And if you want, do it right away, circulate it
among some of your colleagues in the community, and then
get it to us within a couple of weeks so that we can
figure out how we can incorporate it in a way that builds
upon our consensus.
MR. RUIZ: Can I ask, before I leave, though,
218
have any of the broadcasters here at this table given that
any thought up to now? Is there somebody who has already
looked into those things, that you could go to?
MR. CRUZ: I don't think it has been raised.
MR. CRUMP: We think that just straight DTV is
going to eat it up.
MR. MOONVES: We have met with certain people.
I know of the Rupert Murdoch proposal. We have thought of
similar proposals. Are you aware of that proposal? It is
giving $150 million in exchange for 49 percent ownership,
if the FCC will eliminate the 35 percent rule. It is
discussed all the time.
There was a former system they had in place
which ended up people were getting around it right and
left. So, sure, it is something we talk about all the
time.
MR. RUIZ: That is the tax incentives?
MR. MOONVES: We would be very interested in
hearing what you have to say about it, and ideas for that.
MR. CRUZ: I submitted a letter -- sorry, I do
not know if you are done. Go ahead.
MR. RUIZ: I am done.
MS. SOHN: I think your suggestion here on
multiplexing is not that far from what I suggested be
added to the menu today. I think you could play with my
219
language and have it written in five minutes.
MR. MOONVES: The more we can incorporate all of
these things that we did in the body, the better off.
They are a couple of areas, obviously, that are going to
be dissenting reports. But the more that we can come to
consensus and incorporate within the body, I think better
off and more effective we will be. So that would be
preferable.
MR. CRUZ: My last submission that I sent to the
two of you, dated September the 4th I think, goes to some
of that area of concern. And I indicate also that the
topic had not been raised, but it points to the -- I think
that we have an enormous opportunity here to take a
leadership role, as a committee, to encourage I think two
things: women and minority ownership that should be
fostered and broadcasters should be encouraged to employ
more women and minorities so that they can move up that
chain of command.
So I think those, to me, are very crucial. The
myriad of opportunities that are going to pop up in terms
of jobs and the fear of the concentration of the ownership
of the media I think will just lessen the chances of women
and minorities being involved in entrepreneurship,
ownership opportunities. So the best that we can do to
encourage and foster that kind of a philosophy as a
220
position on our behalf I think would go a long ways.
MR. MOONVES: I don't think anybody has a
problem with that. I think that is probably a very good
idea to incorporate a recommendation on those issues
within the paper.
MR. RUIZ: I would also recommend something
based on how local stations, commercial stations, can get
involved with the local PBS stations. For example, I do
not know if you know that Public Broadcasting has three
services that it offers. Many of the stations are in
smaller markets, especially rural ones, do not have the
financial wherewithal to buy the Mercedes/Cadillac version
of the system. Therefore, they do not get the best Public
Broadcasting programming.
Wouldn't it be wonderful in a pay for play type
situation where the commercial station would help the
Public Broadcasting station buy the best of the services,
therefore bringing the best of Public Broadcasting to that
community? Because that Public Broadcasting station alone
does not have the resources to buy that programming. And
that is a good way to work pay for play in that situation.
MR. MOONVES: I think that could be
incorporated.
MR. ORNSTEIN: We are talking about whatever
funding would be used for those purposes.
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MR. MOONVES: I think now is the time we can
open it up for public questions and comments. Anybody?
Please come up to the microphone and state your name and
organization.
MR. CARTER-DONAHUE: My name is Hugh
Carter-Donahue. And I am from the Annenberg Public Policy
Center of the University of Pennsylvania.
And my comments are to address some of the
issues that surfaced this afternoon concerning the
education section, the multiplexing section, and the pay
or play conundrum at issue. We have been doing some work
on digital TV policy. And our idea is to promote and
encourage you to recommend to the Commission serious
consideration of reserving some of the analog spectrum
that is to be returned in 2006 for a public broadcasting
network that would not necessarily be the same as the
existing PBS.
And the concept is that the new emerging public
broadcasting network would be comprised of a certain
portion of the spectrum that is to be returned in 2006,
when the 85 percent saturation may or may not come.
First, as a clear signal to the broadcast community that
the Commission should be serious about actually having the
spectrum returned. Because there is dubiety in many
circles that it will never be returned.
222
And, secondly, in setting this aside for
educational uses and for public interest uses that would
substantially be locally produced and could be LPTV
signals or small or digital channels that would provide
news and diversity and address serious concerns of
localism.
The other portion of the analog spectrum that
would be returned would then be auctioned off, and the
funds from that could then create the fund.
Now, at this point, your charge, as I understand
it from the executive order, is to address the Commission.
And the funds that would be generated from the eventual
sale of any spectrum are simply to go into the Treasury.
They are not to be set into any special fund.
So it would be an opportunity for this
Commission to ask the FCC, or to make a recommendation to
consider this, as a way to promote localism and diversity.
And the technology that would enable this to take place is
a technology that bears the name of a digital drop-in.
And there is spectrum that can be made available in the
allocation that table was specified in the sixth order, I
believe, for such uses.
So the recommendation is basically to try and
employ this notion as a structural incentive that elides
some of these very thorny and difficult first amendment
223
issues, but provides a mechanism that enables the
technology to evolve in such a way that the local
interests and diversity can be promoted.
And I realize that the Commission, after many
months of work, is probably going to be focusing really on
the final polishing of a document. That is certainly the
drift of the conversation that I hear today. And I am
standing up now and speaking now in order to at least
bring this concept to you as a recommendation that we at
the Annenberg Public Policy Center would ask you to
consider to the Commission as part of saying that the
technology is evolving, let's not foreclose it; this can
be a way to avoid unnecessary resistance on the part of
incumbents to what is essentially an ideal that everyone
really is for.
And given the constraints on you folks for your
deadline, we will at some point in the very near future be
submitting written documents to provide a little more
detail and a little more specificity to what I am trying
to outline in rather broad brush strokes now.
And on this basis, I mean the great slam, the
great slam of course of Thoreau, when it came to the
railroad and the telegraph, was that Maine had very little
to say to Texas, and he couldn't imagine that Texas would
have anything to say to Maine. But the virtue of this
224
idea is that it really would provide a mechanism for Texas
and Maine to talk and to share things rather inexpensively
and rather nicely, and go a long way to providing some
public interest programming.
And I would be happy to respond to any questions
anyone would have about it.
Thank you.
MR. MOONVES: Thank you.
Yes.
MR. HATCH: Hi, David Hatch, with Electronic
Media Magazine.
I just have a few questions. I wanted to
clarify a couple of things. First of all, if a voluntary
code of conduct and minimum standards were proposed, do
you have a sense as to which public interest obligations
would be included under each category? And forgive me if
you went over it. During parts of this meeting I was out.
MR. MOONVES: We are still working on it.
MR. ORNSTEIN: We are working on it. You will
get some broad sense from the documents that we have out
there that we have put into our discussion. But they are
not anywhere near final.
MR. HATCH: So, in other words, you don't know
what the breakdown would be as to the obligations under
the voluntary code and the obligations under minimum
225
standards?
MR. MOONVES: Not yet.
MR. ORNSTEIN: No. We are going to have a
little working group that is going to strike an
appropriate balance there. But based on a number of
documents that we have already put together, including Jim
Goodmon's draft, earlier drafts of discussions that we
have had of the code. But there is nothing final.
MR. HATCH: Also, how would minimum standards
fit with your proposal that there be a two-year moratorium
on obligations imposed so that digital broadcasters could
explore marketplace options? If you impose that
moratorium, would they then be still subject to those
minimum standards, or not, for those two years?
MR. ORNSTEIN: That is a moratorium on fees for
the use of multiplex channels, not on standards.
MR. HATCH: And one other question. This
committee will likely propose public interest commitments
for things like children's programming, public service
announcements and many other areas that impact behavior
and learning. I was wondering if you feel that there
is -- for the co-chairmen -- if you feel that there is any
concern that the mission of this committee has been
undermined in any way by the moral problems of the
President?
226
MR. MOONVES: No.
(Laughter.)
MR. HATCH: Do you want to elaborate on that?
MR. ORNSTEIN: Not at all.
MR. MOONVES: No. That is my answer.
(Laughter.)
MR. MOONVES: That's my answer, and I'm sticking
to it.
MR. ORNSTEIN: It has nothing to do with
anything that we've been doing.
MR. MOONVES: Not at all.
MS. CHARREN: What about the electronic media,
are they having any problems?
(Laughter.)
MR. ORNSTEIN: It is true, it is a very good
question as to whether the operations of the press corps
have been undermined in any way by their coverage of the
problems.
(Laughter.)
MR. ORNSTEIN: But we may see another commission
that can deal with those knotty issues, not to mention the
moral problems that have been exhibited in the press
corps. Yes, thank you.
MR. MOONVES: All right. Any final statements
from anybody in the group? Anybody that has not had a
227
chance to say something, that they would like to say?
MR. ORNSTEIN: We will, in a very expeditious
fashion, communicate with you. And let's talk for a
couple of minutes about timetable here.
Our next meeting will be on the 26th, and
reserve as well the half day on the 27th, of October. We
hope we will not need all of that time.
What I would like to do is we will all go to
work now, trying to incorporate all of these comments,
first of all, into the framework that we have, add the
things that we have been talking about here. We will get
these subgroups moving. And I hope that you will move
very expeditiously.
Yes, Peggy?
MS. CHARREN: Is there any sense you have of --
given that we are meeting, and let's assume it goes
well -- when you think the report might be done?
MR. ORNSTEIN: Let me get to that. My goal
here -- tell me if you agree, Les -- is that by about
October 1, that we could have a draft of each of these
areas together, combined with the introductory sections of
the report, so that it would encompass basically a
complete first draft of a report. And in the meantime,
those of you who believe that you are going to be writing
additional views, concurring opinions or the like, may
228
want to start working on drafts of those, obviously
contingent on what else emerges here.
Then we will get that out to you, I hope around
that time, and hope for very quick feedback. And then we
will move, in the process of the next couple of weeks, to
work things out so that we can end up with a completed
draft that we would try to get to you at least a week in
advance, if not more, of the October 26th meeting.
Now, as I said, I expect that what we are going
to have in this report is a solid core, that seems to have
emerged from our meeting, of areas where we have a large
and indeed surprising consensus. There will be one or two
areas here, clearly, where we are going to have some
significant dissent that will probably be reflected in a
majority and a minority viewpoint, or it may very well
be -- I mean I am not sure where we will end up on the pay
or play.
MR. MOONVES: The pay or play seemed pretty
50/50.
MR. ORNSTEIN: It may be basically a
point/counterpoint kind of thing.
Then I expect we will have a section with
additional views. That may be large or may not be large.
But that is open to members to decide what they want to
do. The focus, obviously, is going to be much more on the
229
core where we agree and in overwhelming numbers,
universally or pretty close to that.
If we can then bring that to our meeting on the
26th, we may find that we can move that through very
quickly and give ourselves a lot more free time to do
other things. We will then move to turning whatever we
have there -- if we have to do some additional drafting or
if members decide they need a little bit of time to add
their own views in, we will allow a little time -- but we
would then move towards, as best we can, an expedited
production schedule, and hope that we can have a report in
finished form some time in December -- early December I
would hope.
And then we will work with the Vice President's
office for a time, and we would make a formal presentation
of our recommendations.
MR. MOONVES: On December 24th.
MS. CHARREN: Hanukkah. A Hanukkah present.
MR. ORNSTEIN: On the eighth day of Hanukkah,
yes.
(Laughter.)
MS. SOHN: I want to ask our FACA expert, if I
am writing a concurrence or the center, whatever you want
to call it, and I want other people to join in with me, do
people have -- I mean it would be a huge mess if we had
230
people with similar opinions all writing separate
statements as opposed to one person -- what am I permitted
to do under those circumstances?
MS. EDWARDS: Well, as you know, FACA has some
exceptions. And I think the key one that would apply here
is the exception that allows members to confer if they are
drafting a position paper. And this applies in sort of
the broader recommendation context, as well.
This is why, when you had your original
proposal, Gigi, you could talk to Jim Yee or others. The
problem here is to make sure that the recommendations that
the committee produces have been fully discussed in an
open forum and they are deliberated in an open forum.
If you are writing an individual statement and
you want Harold to join with you, you can confer with
Harold to make sure that that happens. That is a position
paper. That is not the committee's recommendations. And
we can talk about that more in terms of applying it.
I realize that sound really simple now. Often,
when you get down to the nitty-gritty, it gets more
difficult. But I am happy to talk more about that with
you.
MR. ORNSTEIN: Well, I eagerly await the
Crump-Sohn joint position paper.
(Laughter.)
231
MR. LA CAMERA: Well, we can talk about
schizophrenia.
(Laughter.)
MR. ORNSTEIN: Jose.
MR. RUIZ: When we receive the draft, can we
receive a diskette of it? If you want us to be able to
look at it and do some line changes or something like that
and get back to you right away, that would really expedite
it.
MR. ORNSTEIN: I would think that the easiest
fashion for most of us is to E-mail, so that you can put
it right on your computer. But maybe we can have some
options available to members, depending on what works the
best.
MS. EDWARDS: Right. I would assume that there
would be some members who prefer to sort of take out their
green or red pen and go to work. If there are some
members that want to have this in an electronic format, I
think we can do it.
MR. ORNSTEIN: Recognize that, too, when we get
you a draft, we are trying to reach language in most of
these cases that can reach our broad consensus. So if
there are things that absolutely are bottom-line for you,
let us know that. Otherwise try and be as flexible and
understanding as you can of the fact that we are trying to
232
accommodate lots of people that get mostly to the gist of
things.
And we will try and do whatever we can to
incorporate those views. In some cases it may be that if
there is language in a particular case that you just are
not happy with, you can then express your views in a
concurring or an additional way. So just be open to that.
MS. SOHN: Well, I would urge the removal of a
lot of the anti-government language. I don't think I was
the only one who was uncomfortable with that language.
There are a couple of sentences. We do not need to have
any anti-broadcaster or any anti-government language in
there, and still have a consensus report. That is the
place to start.
MR. ORNSTEIN: Understood.
MR. MINOW: You mentioned early December; what
is the date that you have asked for the end of our
deadline?
MS. EDWARDS: We have not proposed a date to the
White House.
MR. MINOW: You did not propose it.
MS. EDWARDS: And we were hoping that they will
come back to us with a date. And Les and Norm will work
with them.
MR. ORNSTEIN: Yes.
233
MR. MOONVES: Early December, sometime.
MR. ORNSTEIN: Yes.
MS. CHARREN: December 15th.
MR. ORNSTEIN: We do not want to get into a
situation where, once again, just because of production
problems or other things, that we have to rush at the
final minute. And so we are going to try and work with
them to make sure we have got enough flexibility, while
trying to do it as quickly as we possibly can.
And I must say, I believe we come out of this in
extraordinarily good shape. There is work to do, but that
work involves less trying to build bridges across very
long open gulfs and much more expanding in some places and
making sure that we can accommodate some very legitimate
questions that have been raised, without losing the gist
of what we are trying to do.
So it is going to take a little time to do that,
but it is not an insurmountable or even difficult
political problem in most cases. So we ought to be able
to work within whatever time frame works for them, as
well.
MR. CRUZ: Norm, some of us have not met David
Bollier. Would you mind introducing him to us?
MR. ORNSTEIN: Absolutely.
MR. CRUZ: And what are the ways of contacting
234
him? Or should we still go through Karen?
MR. ORNSTEIN: I think we probably do not want,
at this point, to have all individual members contacting
David, or we will never get it done.
MR. CRUZ: Okay.
MR. ORNSTEIN: So we will get drafts to you, and
then you can work through Karen and work through us, and
we will make sure that we work with David, who is sitting
there in the front row and who, as you know, has a long
and distinguished record of writing different things in
these areas for groups in some cases even more disparate
than ours.
Do we have any other housekeeping things, Karen?
MS. EDWARDS: I was just going to mention, I
think what we will try to do is to get to you in much more
expedited fashion than is required by law or than we have
done in the past the minutes of this meeting. I think
that could be quite helpful.
MR. ORNSTEIN: Yes.
MS. EDWARDS: I think what I would want from you
in return is everybody seems to be traveling very much
between now and the beginning of October. And it does not
make sense for us to really push and try to get this done
if you do not get it. So if you know that you are going
to be out of your office or unreachable or want us to send
235
it to a different address or fax, please let us know.
MR. ORNSTEIN: Great point.
Okay. I want to thank you all for your
attendance at what has been a very interesting and I
believe extremely productive meeting. Thank you.
MR. MOONVES: Thank you.
(Whereupon, at 3:54 p.m., the meeting was
concluded.)