Don't Touch That Dial

Free Radio Berkeley takes on the FCC and official history

Jesse Walker from the October 1995 issue

(Page 3 of 4)

Hiken doesn't buy it. For one thing, he argues, he and Dunifer aren't necessarily asking for the creation of more spectrum space; they'd be happy for the FCC simply to allocate a certain portion of the spectrum for micro radio, much as it reserves part of the spectrum for educational stations such as KQED.

But if Krock wants to play the spectrum-scarcity game, so can Hiken: 'If you're going to have a megabroadcaster like KQED, that might preclude not just one, but 25 stations from going on the air. In San Francisco, with its hills, you could have seven micro stations at once on one frequency without interfering with each other.' In short, Hiken asks, if you're going to throw someone off the air, why go after Dunifer? KQED is a fatter target.

In fact, a major reallocation of broadcast space is hardly necessary to accommodate both Free Radio Berkeley and a KQED listener's Sony Walkman. In radio, supply can spur demand; consum ers purchase new equipment when it makes sense to buy it. When the Japanese government ended its broadcast monopoly in 1950, the market for radio and TV receivers boomed as the new stations produced material audiences wanted. Before, there hadn't been a good reason to spend more. And, of course, as production increased to meet the new demand, prices began to fall.

When the FCC talks about interference, it isn't just attacking one pirate who may or may not be cutting in on other stations' signals. It's raising the specter of chaos. 'This opens up such a can of worms,' government lawyer Silberman told Judge Wilken after she refused to grant the FCC its injunction. 'You're giving carte blanche for this group of people to operate a radio station without a license.'

This may seem a bit coy. Hiken and Dunifer are not demanding an end to broadcast licensing they're trying to undo the 100-watt rule. Still, in interviews, Dunifer does ruminate freely about an FCC-free world. 'Anything that comes with a license comes with other baggage,' he told Spin magazine. 'The real issue is that the micro community itself can be self-regulated. If there are dis putes, why do we need intervention at the federal level? If someone is being really outrageous, you can resort to simple legal tort action.'

Well then: What would the airwaves be like without licensing? Would we have Dunifer's self -regulated spectrum or the chaos described by government officials? The early 1920s, a period in which a substantial number of radio stations had gone on the air but before the Federal Radio Com missionthe FCC's predecessorwas created by the Radio Act of 1927, provides some context.

Traditional histories of the period describe it as a time of radio gone ga-ga. The Department of Commerce handed out licenses without care for spectrum scarcity, the story goes, and the secretary of commerce (at the time, Herbert Hoover) was unable to hold the line against interference. Nineteen twenty-six ushered in what's been called the 'Breakdown of the Law' period, during which the airwaves degenerated into complete chaos. Then Congress created the Federal Radio Commission, which undertook the long-overdue task of reducing the number of licenses to fit the available spec trum.

Recent scholarship has shown this history to be almost entirely incorrect. Since Ronald Coase's classic Journal of Law and Economics article of 1959, 'The Federal Communications Commission,' most economists have recognized that a more rational solution to the problems of the 'Breakdown of the Law' period would have been to recognize property rights in the broadcast spectrum and treat interference, as Dunifer suggested to Spin, as a tort. Newer researchnotably, UC-Davis economist (and Reason contributing editor) Thomas Hazlett's 1990 article, 'The Rationality of U.S. Regulation of the Broadcast Spectrum,' also published in the Journal of Law and Economicshas shown that such a property rights­based order had in fact arisen in the '20s, without federal direction.

As soon as the Department of Commerce started handing out licenses, a 'priority in use' system of property rights spontaneously emerged, says Hazlett. Broadcasters homesteaded particular fre quencies at particular times of the day (24-hour stations were rare then). Spectrum rights were freely tradeable, and freely traded. Some areas adopted, without government prodding, the institution of 'silent night,' in which local broadcasters would shut down for an evening to allow listeners to tune in to long-distance signals. As the demand for licenses began to exceed supply, problems devel opedbut they were being dealt with.

'Beginning in September 1921,' writes Hazlett, 'when the Commerce Department first recog nized radio broadcasting as a distinct license category, the department initially allowed just a single frequency (360 meters, or 833.3 kHz) to be used for broadcasting, necessitating complicated time-sharing agreements. (What interference took place during this 1921­23 period was, in essence, an outcome of government control: over 500 broadcasters were 'responsibly' bunching up all at the same point on the spectrum to which they had been directed by the Commerce Department, and operations were not always perfectly synchronized.) When this single channel became scarce, Hoover denied new licenses. The Intercity decision [Hoover v. Intercity Radio Co.] in February 1923, growing out of just such a denial, determined that the secretary had no authority to withhold a license but did have the legal right to set hours of operation and frequencies.'

Meanwhile, established broadcasters, looking for protection against competition, wanted the government to limit the number of new licenses it would issue. They had a friend in Hoover. The groundwork for the 'Breakdown of the Law' was laid after the secretary decided, in November 1925, to stop issuing new licenses, arguing that the spectrum was completely filled. He invited a court challenge, and one arrived in April 1926: United States v. Zenith Radio Corp. Like Intercity, Zenith denied Hoover the right to withhold a license. Unlike Intercity, however, it denied him discretion over time and wavelength assignment.

Hoover did not appeal the case. Instead, he asked Acting Attorney General William Donovan which District Court decision to follow. On July 8, Donovan came out for Zenith and asserted that the government had no authority to define spectrum rights. 'Faced with open entry into a scarce resource pool, a classic 'tragedy of the commons' ensued,' writes Hazlett. 'Stations had to be li censed by the secretary of commerce; once licensed, they were free to roam the dial, select their own transmitting location, choose their desired amplification level, and set their own hours.' Hoover had created a crisis, and Congress quickly created the Federal Radio Commission to deal with it.

At the same time, non-regulatory solutions were ignored. In November 1926, for instance, WGN had sued the Oak Leaves Radio Station, claiming that the latter had essentially committed trespass by interfering with its signal. The court ruled in WGN's favor, explicitly basing its decision on homesteaded property rights. But the commission had no use for this approach.

Nor did it have any use for expanding the spectrum to allow more stations to broadcast. This was technically feasible but politically unpalatable to the big broadcasters, who preferred to make room by eliminating their smaller competitors. The industry defeated spectrum expansion by arguing it would require listeners to buy expensive new sets to hear the additional stations. That this might be preferable from a consumer's point of view to not being able to hear the other stations at all was not considered.

In August 1928, the commission announced General Order 40, its spectrum reallocation plan. The effect, as University of Wisconsin historian Robert McChesney argues in his 1993 book Telecommunications, Mass Media, and Democracy, was to eliminate most nonprofit stations (about a third of the 1920s radio market) and to nurture the networks. The commission favored 'general public service' stations over 'propaganda' stations, the latter defined, in McChesney's words, as broadcasters 'more interested in spreading their particular viewpoint than in reaching the [broadest] possible audience with whatever programming was most attractive.'