Page 83 - Communication Commerce and Power The Political Economy of America and the Direct Broadcast Satellite

Telesatellite Policy and DBS, 1962-1984 71

Affairs, in Hearings on 'Satellite Broadcasting: Implications for Foreign
Policy,' pp. 64-5.
63 In 1966, AT&T charged ABC $12 million annually for its microwave
distribution services. ABC estimated that a telesatellite system designed
for its particular needs could save $5 million over a five-year period. See
Smith, Communication via Satellite, p. 158. According to Heather Hud-
son, because of these minimal savings, 'ABC may have been using its
satellite option merely to put pressure on AT&T, by threatening defec-
tion if AT&T increased its rates' - Hudson, Communication Satellites,
p. 40.
64 In 1974, as a result of what was commonly called the 'Open Skies'
policy, Western Union launched the first competitive domestic telesa-
tellite. By 1984, seven US companies operated domestic telesatellite
systems.
65 Building on the earlier ABC application, in 1969 CBS television officials
proposed the formation of a domestic telesatellite system owned and
operated by all three television networks.
66 President's Task Force on Communications Policy, Final Report,
(Washington, DC: US Government Printing Office, 7 December 1968);
herein referred to as 'Rostow Report'.
67 For example, in 1972 (the year of the Watergate break-in and Presiden-
tial election) Nixon directed John Mitchell to file antitrust suits against
the three television networks through the DoJ. These had been prepared
in 1970 and were apparently applied two years later only as a result of
the broadcasters' 'negative/anti-Nixon' news reports. Two months
before election day, the head of the OTP, Clay Whitehead, delivered a
speech in San Francisco that was commonly interpreted as another
threat. Whitehead claimed that an OTP study supported the demands
of the American Screen Actors' Guild that ABC, NBC and CBS should
be compelled by the FCC to spend more money on original productions
rather than airing reruns. The message to the networks was clear:
modify negative coverage of White House activities or face higher
costs and legal skirmishes. Tunstall, Communications Deregulation,
p. 208.
68 Lyndon B. Johnson, 'Message from the President of the US: Recom-
mendations Relative to World Communications' (14 August 1967),
reprinted in Rostow Report, Appendix A, p. 3.
69 Kinsley, Outer Space and Inner Sanctums, p. 150.
70 Rostow Report, chap. 7, p. 32.
71 Ibid., p. 33. Lloyd Musolf estimated in 1968 that a domestic DBS system
with roughly similar capacities would cost half as much as the GSO-
terrestrial hybrid system proposed by Comsat in 1966. See Musolf (ed.),
Communications Satellites in Political Orbit, p. 148.
72 Rostow Report, chap. 7, p. 33.
73 For examples, see Barry Cole and Mal Oettinger, Reluctant Regulators,
The FCC and the Broadcast Audience (Reading, Mass.: Addison-Wesley,
1978), chap. 10.
74 Rostow Report, chap. 7, pp. 36--9.