From the foregoing analysis, the best course is clearly not to try to improve the present system, but to fashion a new policy that works both to ensure high-quality public service and to eliminate First Amendment strains and much of the present asymmetric regulation of cable and broadcast television. This new policy would substitute a modest spectrum usage fee for the public fiduciary obligation. Congress could reasonably establish such a fee based on a percentage of gross revenues, say, 1 percent for radio and 2 or 3 percent for television. This fee might then be set forth in a long-term contract, for example, 15 or 20 years, between the FCC and the broadcaster, so that it would be exempt from the effects of government policy changes toward the media.58

This policy would have far-reaching beneficial effects. For example, the market deficiencies of radio could be remedied. Commercial radio does not now supply in-depth informational programs, serious dramatic programming, programming for the blind, and so on. Noncommercial radio does, but it is inadequately funded. With a 1 percent spectrum fee, $90 million would be available, with roughly $70 million for public radio and $20 million for an interim minority enterprise small business investment cooperative (MESBIC) to further minority ownership of radio stations. All new frequencies would be auctioned, and the sums obtained (probably inconsequential in view of the dearth of available frequencies in larger markets) would be contributed to the same fund.

If this new policy were adopted, our policy structure would actively promote public service policy goals for the first time. The commercial radio system would continue to do what it already does--deliver a variety of formats, often interspersed with brief messages--and the noncommercial system would have sufficient funds to accomplish its goals. In addition, all First Amendment strains arising from the public trustee renewal process would be eliminated, and the removal of that process would place broadcast journalists on the same footing as their print counterparts. Eliminating the fairness doctrine would not have the same effect because an administration seeking to dampen opposition would not do so through fairness rulings (which are subject to review in court) but rather would try to manipulate the public trustee process instead (see footnote 58).

The same approach would help facilitate the production and presentation of high-quality public service television programming, that is, cultural, for children, and in-depth informational programming. The sums obtained--$500 to $750 million--hich might be augmented by auctions of new channels and by some portion of cable franchise fees (discussed later), would contribute substantially to resolving the perennial funding problems of public telecommunications, which are extensively documented in Quality Time?, a recent report of the Twentieth Century Fund Task Force on Public Television. The most arresting statistics in the report show the amounts spent per capita by various nations for public broadcasting: in 1992, we spent only about $1.06; Japan spent $17.71; Canada spent $32.15; and the United Kingdom spent $38.56.59 The unfortunate result of this inadequate funding has been the increasing "commercialism" of public television.

Some have argued that there is no need for the public service contribution of public television in light of cable's multichannel development. However, as Congress has determined, there is certainly a need in the area of high-quality children's television programming. With respect to cultural programming or drama, traditional or experimental, even a casual review of TV Guide will reveal the dearth of new material. Cable has difficulty producing substantial amounts of such new programming because the cost of each show must be weighed against small audience shares. PBS coverage of congressional hearings and shows like the "MacNeil/Lehrer Newshour" and "Frontline" contribute significantly to an informed electorate, especially for some 40 percent of the audience not on cable or not receiving C-SPAN. Someday, perhaps, the market will provide all the public service programming needed. In the interim, however, a failure to support our best source of such programming would be disastrous.

Although the focus of this paper is on near-term congressional action, the temporary nature of such action must be emphasized.60 As broadcast television moves into the digital future, with perhaps four to six signals for broadcasting in the advanced television mode (and a significant proportion in high definition), further reform, e.g., reasonable access requirements, may well be required, and part of the spectrum fee may be allocated to support such access (thereby significantly paralleling the situation in the multichannel cable milieu).

The near-term focus is also appropriate in the context of Congress's present effort to reform Title II. That pending legislation would remove obstacles to all-out competition in telecommunications as we move into the next century (e.g., actively fostering local competition and addressing the restrictions on the divested Bell Operating Companies). Understandably, except for a single telecommunications aspect of broadcast operation, Congress was reluctant to "overload the circuits," and thus postponed consideration of Title III.61 However, as noted at the outset, the time has come for Congress to focus on Title III.

Commercial broadcasters should welcome and support this legislative opportunity, which would be highly beneficial to them. They would have long-term franchises free of public service scrutiny, the renewal process, including petitions to deny and comparative renewals, all fairness controversies, and anti-trafficking regulation. Because the public does not generally distinguish between cable and over-the-air television, the regulatory scheme for both should be similar: both would then have long-term franchises and franchise fees (although the broadcast fee may be lower than the cable fee), and neither would be scrutinized for public service content.62

Elimination of the public trustee concept will strengthen the scheme requiring cable to carry local broadcast television stations. Carriage based on content would not survive the strict scrutiny test: see Turner v FCC (cited earlier), where the majority found that congressional mention of the value of broadcast programming (e.g., local news) was merely a recognition that the signals have value, not an expression of preference for one form of speech (local broadcasting) over another (cable programmers). The carriage issue would greatly benefit from a "may carry, must carry all" approach. Then cable could either act as a master antenna for business reasons (which, of course, it must do) or leave the broadcast medium alone (in which case, viewers would insist on an A/B switch and retention of off-air antennas, because the broadcast signals remain the most popular). When cable chooses to act as a master antenna, however, it cannot then decline to carry some stations in view of its bottleneck nature (Turner v FCC). Such refusals, always directed at weak UHF stations like Channel 32 or Channel 50 in Washington, D.C, stifle competition and seriously imperil these stations.63 Under the "may carry, must carry all" approach, cable could be given a reasonable period of time (e.g., three years), to achieve compliance. This antitrust type of regulation would be constitutional under the O'Brien analysis (see page 24, Constitutionality of the Access Approach) and would not involve any remand to lower courts for fact finding.

The National Association of Broadcasters (NAB) may oppose this reform, despite its advantages to broadcasters. In the 103rd Congress, the administration sought funds to offset lost revenues from the General Agreement on Tariffs and Trade (GATT) reductions and proposed a $5 billion spectrum usage fee on broadcasters (beginning at 1 percent of gross revenues and rising to 5 percent). The NAB successfully opposed this effort, and used the argument that this fee scheme would "change the landscape of communications policy" by eliminating broadcasters' commitment to serve the public interest in exchange for free use of the spectrum. "Broadcasters have always supported that compact, [NAB President] Fritts says. This proposal, however, puts it at risk, he says."64P> The NAB may be taking a short-sighted view. Even though it has successfully warded off the spectrum fee in the 103rd Congress, its president correctly predicts that the issue will return.65 It will re-emerge next year or the following year because the administration or Congress needs new sources of revenue to compensate for deficit constraints, and because the auction of spectrum for personal communications services will show the value of the broadcast TV station's six MHz (the NAB shrewdly opposed such auction proposals even when broadcasting was omitted).66 Because broadcasters have conceded the need for a spectrum royalty where ancillary services are involved, it is only a matter of time before the spectrum usage fee is imposed.

The policy proposed above would give broadcasters bargaining strength to negotiate for attractive benefits, including a modest fee fixed by a long-term contract. The NAB's strategy, by contrast, may well lead to imposition of the fee without reform of the public trustee scheme, and the fee will surely be raised over time as the government's financial needs increase.

In short, here is a window of opportunity, a win-win situation for broadcasters and the public. If that window closes, if the spectrum fee disappears into the black hole of the budget deficit in a future Congress, we will have forfeited our last chance to obtain and enhance real public service in the broadcast area. In particular, we will continue to short-change our children.