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The Battle of the Titans
The mass marketing of home receivers in conjunction with the
inauguration of regularized programming was a bold business gesture
precipitated for the most part by RCA and its president, David
Sarnoff. The move was typical of Sarnoff and his tough business
technique. An impoverished Russian immigrant who in his youth had
been a telegraph messenger boy and a wireless operator, he battled
to leadership of U.S. telecommunications by stressing refinement of
the engineering fundamentals—"the pipes," he called them—of radio
and television. He blended the scientist's understanding of wireless
technology with a determined, austere management style that made his
employer, the Radio Corporation of America, the most formidable
electronics operation in the United States.
It was Sarnoff who attracted experimenters such as Zworykin to the RCA
research laboratory. It was Sarnoff who made the hard deals—usually through
purchase, but, in the case of vital components controlled by Philo T.
Farnsworth, through licensing arrangements—that brought to RCA technical patents
strategic for transmitting and receiving TV signals. It was Sarnoff, too, who
still found time to serve in the armed forces, entering World War II as a
colonel and ending up a brigadier general in the U.S. Army Signal Corps. In the
mid-1950s in a company film called
The Story of Television,
Sarnoff and Zworykin discussed their roles in the development of television—at
least their roles in developing the technology of the new medium.
In producing U.S. television he had rivals in Philco, Zenith, DuMont, and
others. In a company film,
The DuMont Story, A Story of Television, the
New Jersey-based corporation in the early 1950s asserted its pioneering role in
the technical development of television. The same was true for the
Farnsworth
company in a Popular Science theatrical short from Paramount in 1940. But
through corporate ties to NBC only Sarnoff could combine formidable technical
and financial power with the programming richness necessary for national
broadcasting. As his biographer Kenneth Bilby has described him, Sarnoff "was
perhaps the last of that remarkable strain of individualistic
entrepreneurs—Rockefeller, Ford, Carnegie, Frick, Harriman were among them—whose
autocratic governance of industrial oligarchies bruised the precepts of free
competitive enterprise but spurred the tumultuous growth of the late nineteenth
and early twentieth centuries in America."
For Sarnoff the launching of television in 1939 was a double-edged business
enterprise intended to sell TV sets to the public and impose RCA technical
standards on the industry. If RCA/NBC could develop, produce, and market
receivers as well as programs, the corporation could establish itself as the
technological, manufacturing, commercial, and programming giant of television.
With such advantage, it could monopolize the emerging industry from the outset.
Although many in the business felt that Sarnoff was technologically premature
in offering regular home TV service, if enough consumers in the New York City
area bought into RCA video at this date it would be difficult for the regulatory
Federal Communications Commission (FCC) to render tens of thousands of sets
obsolete by revising transmission and reception standards. Then, by extending
its broadcast signal through cable and electrical relays, RCA could move on to
conquer other U.S. cities. In
Television, a ten-minute promotional film created
in conjunction with its marketing campaign and the New York World's Fair, RCA
alluringly tied its product to public anticipation of television:
And so a new American industry has been born. Television is taking
its place as another important and vital contribution to our daily lives. It
is a modern miracle, a new public service produced by combining RCA
laboratory science with manufacturing skill. The research problem of
yesterday is the radio marvel of today. Another milestone of progress has
been passed, and science has made a reality of the age-old dream of pictures
from the sky.
But optimism at RCA proved ill-founded. During the first six months of the
sales push consumers purchased fewer than five hundred units. Where company
executives had envisioned the dissemination of a hundred thousand sets by
Christmas 1939, total sales for all manufacturers during the first full year
were about three thousand sets. One observer wrote in 1940 that "Television
during the past year suffered as stormy a fate as ever beset a branch of the
radio industry." In this failure RCA had spent an estimated $10 million.
There were several reasons for the fiasco. Technically, with no relay
facilities television transmissions could only reach the horizon. This limited
reception of TV signals—transmitted by W2XBS from atop the Empire State Building
and by W2XAB from the Chrysler Building—to customers residing within a radius of
about fifty miles of the point of transmissions. Further, the price of receivers
was high, some costing as much as a moderately priced automobile. And by the
fall of 1939 economic and political uncertainties in the United States were
exacerbated by the outbreak in Europe of World War II.
RCA also met technical and programming opposition from business competitors
and from the FCC. Eugene McDonald, the president of Zenith, a company that felt
itself long abused by RCA's monopolization of radio, deeply distrusted Sarnoff
and felt that the majordomo of RCA was about to snatch the TV industry from its
cradle. McDonald even purchased newspaper advertising space to publicize
Zenith's claim—and to sow seeds of doubt in the public being asked to buy
TV—that the move to regularly scheduled programming was "premature both for
economic and technical reasons."
At Philco, President Lawrence E. Gubb was also tenacious competition for
Sarnoff. In the mid-1930s, when Philco radios were the bestselling units on the
market, the company sued RCA for stealing confidential information by
exploiting several Philco female employees, "intoxicating them with liquors at
hotels, restaurants, and nightclubs," and seeking to involve the women in
"compromising situations." RCA denied the charges, and the suit was later
dropped. However, it revealed the bitterness inherent in these corporate
battles. By 1940 Philco was engaged in open warfare against RCA television,
accusing Sarnoff of business skullduggery and arguing that nothing less than
the future of the video was at stake.
These were bitter rivalries that exploded beyond simple capitalistic
competition. As Sarnoff’s biographer has sketched it, "To McDonald, Sarnoff was
a monopolistic predator who played scheming 'Russian tricks' to enforce RCA's
illegal clutch on the industry. To Sarnoff, McDonald was a bloated 'parasite'
who feasted on the products of RCA research to build a huge consumer business
and a personal fortune." Fortune magazine concluded at the time that
television was "a prima donna industry, as full of feuds and temperament as an
opera troupe."
Sarnoff’s toughest and most successful rival in the programming aspect of
broadcasting was William S. Paley, president of the Columbia Broadcasting
System. In his memoirs, Paley graciously referred to Sarnoff as a venerable
uncle. It was sentimentality missing in their actual rivalry. "The general and I
had a long, continuing avuncular relationship down through the years," recalled
Paley. "From the earliest days of radio, when he was the 'grand old man' and I
was 'that bright young kid,' we were friends, confidants, and fierce competitors
all at the same time, and we understood each other and our relative positions."
Personally, Paley was much that Sarnoff was not. Paley was American-born,
handsome, gregarious, and charming. He was "Bill" while Sarnoff was "the
General" or "Mr. Sarnoff." Paley was also wealthy from the start, the son of a
millionaire Philadelphia family that owned the Congress Cigar Company,
manufacturers of La Palina (a Spanish neologism based on the Paley family name)
cigars. Moreover, reflecting the fact that CBS was born as a programming
enterprise while NBC sprung from the technical prowess of RCA, Paley was an
impresario more concerned with the show than with the equipment used to transmit
or receive it.
To embark on his long and successful career as a broadcaster, Paley and his
family paid $503,000 in 1928 for controlling interest in the failing United
Independent Broadcasters and its fledgling radio network, the Columbia
Phonograph Broadcasting Company. The following day—two days short of his
twenty-seventh birthday—young Paley became president of UIB and the network,
which he soon renamed the Columbia Broadcasting System. A decade later he and
his family still owned about one-third of the CBS public stock, and for more
than six decades he remained a decisive force in the direction of the network
and American broadcasting.
By 1936 Paley had learned that one way to better NBC radio was to raid its
pool of talented performers, expending large amounts of money and great personal
charm to woo to CBS established crowd-pleasers such as Al Jolson, Eddie Cantor,
and Major Edward Bowes. Paley also purchased NBC's prestigious Lux Radio
Theater—with its hour-long dramatizations of great plays and movies, usually
featuring the original stars, and produced by the influential film director
Cecil B. DeMille—moving it from New York City to Hollywood, where it remained a
popular favorite for twenty years. Such bold actions catapulted CBS to
programming supremacy during the 1936-1937 radio season and established a
pattern Paley would repeat for CBS-TV in the late 1940s.
While Sarnoff had long disliked the advertising aspects of commercial
broadcasting, Paley was a businessman who sought the most popular entertainment
because it would produce the largest and most profitable audiences. As he wrote
in 1940, "Advertising may not be the best method, but no one has evolved a
better one, or indeed any alternative which does not entail either government
control or indirect but effective government influence on what goes on the air."
CBS, like Philco, Zenith, and other companies, refused to allow RCA
technology, and therefore NBC programming, to define American television. These
companies argued effectively that the engineering standards advocated by
Sarnoff—30 frames and 441 scanning lines per second, with AM radio sound and
black-and-white capability only—were inferior to their own. Philco felt the
standard should be 24 frames and 605 lines, and Allen B. DuMont of DuMont
Laboratories called for 15 frames and 625 lines. Others felt that FM
transmission would provide improved sound and that Americans should be offered
color TV. All agreed, moreover, that mass acceptance of RCA products would lock
U.S. television into a position of technical mediocrity from the outset.
For its part, the FCC refused to act precipitously in setting broadcast
standards for television. Instead it vacillated, which served to confuse the
matter further. Such hesitation prompted Variety in mid-1940 to describe the
situation as "such a muddle ... that no predictions of coming progress may
safely be ventured." The commission wavered between reluctant support for the
bullying enterprise of Sarnoff and RCA, the desire to keep the new industry open
to competition, and the wish to protect consumers from buying TV sets that would
become obsolete quickly. While NBC and CBS had been broadcasting on a regular
schedule for almost a year, and RCA and others had been manufacturing and
marketing home receivers, the FCC acted and then reacted.
On February 29, 1940 the commission agreed to partial commercialization that
would allow stations "to make charges against program sponsors ... but without
charge for transmission." Although the decision was to become effective in six
months, it still did not allow profit-making. Stations would be allowed to
charge advertisers only the production costs of the show and commercials. Still,
it was considered a cautious first step toward completely commercial TV.
For David Sarnoff, however, partial commercialization was greeted as an
opening through which to ram the RCA juggernaut. On March 12, less than two
weeks after the FCC decision, Sarnoff was ready with a full-scale assault on
consumers and the industry. NBC promised an elaborate improvement in the
programming already being aired on W2XBS. RCA announced a renewed sales drive
spurred by reductions of set prices by 33 percent. Then, looking beyond the
fifty-mile horizon, NBC announced that a series of TV relay stations would soon
link New York City and Philadelphia. NBC also filed applications to operate
television commercial stations in Philadelphia, Chicago, and Washington, D.C.
Clearly distressed over the power grab orchestrated by RCA/NBC, the FCC
quickly scuttled Sarnoff’s plans by announcing on March 23 that it was
suspending partial commercialization: television was returning to its
experimental stage for further refinement. The commission blasted RCA's
aggressive tactics and reiterated its intention not to saddle the public or the
industry with receivers that many felt were inferior.
Not until the following year—after the full industry, under the auspices of
the newly created National Television System Committee (NTSC), agreed on
improved standards of black-and-white transmission at 30 frames and 525 lines of
resolution (still inferior to the 625-line standard of European television) plus
improved FM radio sound—did the FCC alter its position. It accepted an NTSC
recommendation to allow commercial TV to begin July 1, 1941. Significantly, the
engineering standards approved on the eve of World War II have remained
operative. Only the challenge of high-definition television in the last decade
of the century has threatened to force a reformulation of the technical
specifications of American television.
RCA had little trouble adopting the NTSC standards. The company even offered
to adjust at no charge RCA sets purchased earlier by the public. Sarnoff also
bought advertising space to proclaim that the new specifications were really the
same as those at RCA. On July 1, WNBT inaugurated the first commercial TV
operation in the nation. Optimism about the video future at this time was
captured in an industry film from 1941 entitled
Magic in the Air.
The launching of WNBT was an event NBC had been anticipating. Unlike the
early 1920s, when there had been strenuous debate over whether radio should
remain free of commercial messages or become a self-supporting electronic
billboard, there was no doubt that U.S. television would eventually be
advertiser-supported. In August 1939 NBC produced the first experimental
commercials when announcer Red Barber, during the telecast from Ebbets Field of
a baseball game between the Brooklyn Dodgers and the visiting Cincinnati Reds,
delivered live pitches for Procter & Gamble soap products, Socony oil, and
General Mills. For the latter, Barber even prepared a bowl of Wheaties breakfast
cereal on camera, adding cream, sugar, and a banana for the edification of those
watching on about five hundred TV sets in the New York area.
When the FCC granted telecasters the right to charge fees for commercials,
again NBC was the first to act. On July 1, WNBT aired a "Bulova time check" in
which the face of a Bulova watch appeared on-screen, its second hand ticking,
while an off-camera announcer told viewers what time it was. Time charges to
Bulova were $9.
Although the public had not rushed to buy TV sets in New York City, at least
the nation remained intrigued with the medium. From the opening days of the
World's Fair, the exhibits of television at the RCA, Westinghouse, and GE
pavilions were so popular that police had to be hired to control the long lines
of those wishing to see the new electrical marvel. TV also went on tour. During
the period 1939-40 the Farnsworth Television Company traveled the country
promoting the medium. In department stores in eighty-eight cities—from Frederick
& Nelson in Seattle to Leavitt's in Manchester, New Hampshire—more than three
million Americans saw television for the first time.
Philco and RCA conducted similar tours, introducing their receivers to
retailers and future customers. Typically, in Chicago RCA constructed a TV
studio in Marshall Field's department store and for two weeks presented
public
demonstrations for as many as ten thousand daily visitors. The excitement of the
event was epitomized by a local radio announcer broadcasting from the site on
June 12, 1939. Greeting television "with unmitigated enthusiasm," he hailed the
new technology as "the greatest achievement of the twentieth century" and
claimed that TV was proof that "we're certainly living in an advanced mechanical
age."
Although the FCC permitted several stations to become fully licensed
commercial operations, the weight of world events thwarted further progress.
Expectations within the industry were dampened when President Roosevelt in May
1941 declared an unlimited national emergency. This austerity step, plus
federal actions following U.S. entry into World War II in December, effectively
froze the technical development and marketing of television. Now scientific and
engineering skills—as well as the vital materials needed in TV
manufacturing—were placed at the disposal of a government waging war on two
fronts.
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