PAGLIN: This is July 29, 1987. We are in the offices of Malarkey‑Taylor Associates in Washington, D.C. to interview Archer S. Taylor who is a principal and a co‑founder of the firm of Malarkey‑Taylor Associates, and its Senior Vice President of Engineering. Mr. Taylor is also a founder and a pioneer in the field of cable television. This interview is one in a series of oral history interviews of pioneers in the cable television industry being conducted under the auspices of the National Cable Television Center and Museum at the Pennsylvania State University. I am Max D. Paglin, the Executive Director of the Golden Jubilee Commission on Telecommunications. Archer, please tell us something about your background and personal history. After that we'll get into your early involvement in cable.
TAYLOR: I was born in Colorado, a few miles north of Denver in Longmont. My father was an educator. He was principal of the junior high school and the high school in Longmont. He left Longmont about 1926 or '27 when one of his most trusted and beloved teachers came to him and said, "Archie, I think you better join the KKK." His name was Archibald. He insisted that I was not going to be named Archibald so the compromise came out Archer.
PAGLIN: When were you born?
TAYLOR: In 1916. Dad was told that it was about time for him to join the Ku Klux Klan which, in Colorado in the mid 20's, was an anti‑Catholic organization with the hoods and the fiery crosses, and the whole bit. So Dad, who had a bachelor's degree, decided that this would be a good time to go and get his master's and Ph.D. So he enrolled in Harvard, took his family back East, and got trapped in the Great Depression with three children. He never left.
PAGLIN: What was your father's religion?
TAYLOR: They were Presbyterian. So I kind of grew up after the age of 10 or 11 in the Boston, Massachusetts area. At that time, Dad got work as a vocational guidance counselor in the Boston school system.
PAGLIN: When is that?
TAYLOR: That was in the late 20's and of course he stayed on until he retired. I grew up then in Watertown/Belmont, Massachusetts. Belmont is interesting because there are a lot of cable people who come from there, Tom Shack, Doug Dancer, Bill Headley.
PAGLIN: Is this a coincidence of some kind?
TAYLOR: This is just plain coincidence. They just happened to be from there. But in 1933, of course this was in the Depression years, and I wanted to go to college. I was the oldest of 3 children. My brother was three years younger than I am. My sister 10 years younger. But I decided to go to Antioch College in Yellow Springs, Ohio. Arthur Morgan had taken over ‑ I believe it was a Baptist college, small independent Baptist College, not independent but Baptist and made it into a liberal arts educational institution with the hope that he could change society by educating young people. One of the things he did at Antioch was to pick up the cooperative education scheme that had been initiated in Cincinnati. Of course, in the Depression years, being able to work while you were going to college was a pretty important element.
By 1933 when I went to Antioch, jobs were very scarce so instead of a six year program working half time each year, they had you go full time as a freshman and it was a five year program. The plan was to work either five weeks or ten weeks on a job and then come to school for either five or ten weeks and you'd alternate with another student who was your co‑op. He would go to work while you were in school. It was a very great opportunity to learn what the world of working is about while you're in school, making school much more meaningful.
PAGLIN: That was a fairly novel situation at that time.
TAYLOR: Quite novel. The University of Cincinnati, I think, was the first one to initiate the program. Northeastern University in Boston also had a work study program. Antioch perhaps had more publicity and better knowledge.
My first job was in a printing plant ‑ Litho Printing Plant in Cleveland ‑ I did layout work. I made a mistake one time. I had to rerun a whole big run of books because I had put the pages down wrong. Feeling terrible about it and very apologetic and chagrined and so on, my foreman who was a lady said, "Well, don't worry about it because that's why they put rubbers on the end of pencils and rubber mats under spittoons."
PAGLIN: They didn't fire you?
TAYLOR: No, no, I worked there for one year. Normally in the work study program, ideally I should say, you would like to have a job that's in your chosen field. Well, I had known since I was a very small child that I wanted to be an engineer. But an engineer is a guy that builds bridges and I just always marveled at how you could build a bridge coming from the two ends, get them to meet together just right so that you could put a bolt in to hold them together. Just marvelous, till I discovered that those holes that they put the bolts into elongated holes to make up for the errors that people made. My advisor in my freshman year, I guess it was, was a mathematician, statistician of some considerable note. He went to the University of Michigan after this stint and became one of the leading mathematical statisticians. But he said to me, "Why do you want to be an engineer? Why don't you go into physics? That's a much more fundamental, much more important area." I thought about it and went to talk to the head of the physics department. So I entered the physics curriculum and got my degree in physics.
PAGLIN: Were you still in the work study program at that time?
TAYLOR: Yes, I finished the five year program of work study. In 1936 they offered me a job at Wright Field in the Signal Corps Laboratory in radio. I said, "Well I don't know the difference between a vacuum tube and a storage battery." "That's alright, you can come ahead." So I took the job. We were working on blind landing of aircraft, automatic landing of aircraft. This is back in the mid 30's when it was really quite rare. An awful lot of stuff we didn't have. In fact we worked at, and engineers will appreciate this, we worked at fantastically high frequencies. We called them ultra‑high frequencies. It was 75 megahertz. We were using magnatrons and Lecher wires.
PAGLIN: Did Wright Field design its own equipment or did they put it together?
TAYLOR: We had to design and build our own equipment. Some of it was contracted out but through our design. Not me, I was only an apprentice. We built fan markers. I went out on an inspection trip for a contractor who was building receivers for the fan markers.
PAGLIN: What's a fan marker?
TAYLOR: The radio range beacons at that time had a cone of silence. When you flew right over it you would get no indication because there was no signal. The flyers for safety reasons wanted a positive indication that they were over it and not just nothing. So this was a marker to go in the cone of silence. Also the fan marker was used as a signal to mark certain positions along the approach course for a landing. And the method of automatic landing or of blind landing was a power landing. They had four markers away from the field. One was right at the edge of the field, right at the fence line and then the first one, I think, was five miles out. You would come in at a predetermined altitude to the first marker then you would throttle back and go until you hit a second predetermined altitude then throttle ahead until you get the marker. Then again you would throttle back and glide down until you got to the predetermined level and in the mean time you're following localizers so that you swing back and forth until you're all lined up on the runway. Then you come in for a landing. We also rigged this up to be automated ‑ relays, selsyns, much stuff ‑ it was a magnificent system.
PAGLIN: And this was what period, late 30's?
TAYLOR: Late 30's ‑ '36, '37.
PAGLIN: This is about the time in Great Britain they were developing, no a little earlier, the Doppler Radar.
TAYLOR: I didn't know anything about radar. I'll tell you about that later but we had some Doppler effect operations we were using, testing anyway. We didn't call it radar. The Air Force gave us an old cargo plane that had been condemned and we could use that for automatic landing experiments which we did. We rigged it all up for automatic landing and my boss, C.D. Barbulesco, "Barby," used to say that we made 20 successful automatic landings out of 22 tries. Immediately you begin to think of an airplane pilot up in the field somewhere with a guy killed and so on. That fact of the two that were missed was that there was another airplane on the runway and he had to override the automatic and come back and try it again. It worked, worked well. My co‑op was Pete Murray who ‑ he stayed with the Signal Corps after college. He was the guy who worked when I was in school, and then when I was working he would be in school. He went on with the Signal Corps and was one of the outstanding experts in drone aircraft, non‑piloted automatic ships and was recognized by the Signal Corps and the government and as a Fellow in the IEEE and so on. He stayed with it.
I graduated in 1938 wondering what I should do, had job feelers out and so forth. One came in from the National Bureau of Standards here in Washington ‑ Dr. J.H. Dellinger who was the chief of the radio section. They were planning an Arctic expedition in 1940 and wanted a young college guy to come and help put together the equipment that they were going to use on that Arctic expedition. Well I talked to my advisor who was the head of the physics department, a Welshman named Gwylem Owen, and asked him what did he think about it. And he said, "Well, the Bureau of Standards is a great place to be from." And it turned out to be excellent advice. It was a great place to be from. Great experience but not one that I would want to go back to. Government employment just leaves me cold.
We put together automated equipment to sound the ionosphere, bouncing pulses off the ionized layers to measure the time it took to come down. Had an automatic camera to record this ‑ a lot of automated equipment. Nineteen forty was to have been the expedition. Dellinger was coming back from a CCIR meeting, I believe, in Europe somewhere, I'm not sure where, and this was in the days when you traveled by boat. On the boat was a spinster lady named Louise A. Boyd who, to her credit, had tons of money out of the old Gold Rush days ‑ her father had been a miner, and had money to burn ‑ but she did not like to just sit around social gatherings and, instead, she wanted to be doing something. So she had traveled on several expeditions into east Greenland and the waters around Spitsbergen and Iceland and so on with research vessels that were going up there. She just traveled as a passenger but she got fascinated with Arctic exploration.
PAGLIN: How old was she?
TAYLOR: She was a woman considerably older than I. She was just about the age of my father so that gives you a generational idea anyway. She and Dellinger talked and she said that she would like to sponsor an expedition with the Bureau of Standards scientists going along. He had indicated how he wanted to get some studies in the high latitudes where he'd have aurora borealis and so on. So the arrangement was made that in 1940 the expedition would leave Alesund, Norway. And Alesund is spelled A with a little 0 over it, Alesund, on the coast of Norway, one of these fjords that goes back into it.
The Germans got to Norway before I did. They went in in 1940 and occupied Norway. So I went to Dr. Dellinger and told him I've got to make some personal plans. Is the expedition going or not? "Well," he said, "of course not, no way. Well, let me call Miss Boyd and see." So he called her. Her answer was exactly the same, "Well obviously not. We can't go. Well let me see if I can get an American charter." So she scouted around and found Captain Bob Bartlett of the National Geographic fame and he had a boat that he had gotten some time back in the 20's through Commodore Ford or Vanderbilt, one of those well known racing Commodores, Yacht Club commodores. It was the Effie M. Morrissey. That was the lady's name, Effie. M was the middle initial and Morrissey, two r's and two s's. The publisher, Putnam, had a young boy named David ‑ probably a year or two older than I am I would guess. George Putnam, this was Amelia Earhart's husband, publisher Putnam, took a liking to Bartlett and told him he would put an auxiliary motor in the Morrissey if he would take his son David along on one of his expeditions. So David went along. You'll find published, by of all coincidences, Putnam Publishing Company, David Goes to Greenland, David Goes to Bafflinland. Very interesting books which I studied very carefully because of the pictures in them and what it would tell me about the Morrissey.
So we couldn't go in 1940 and we decided to go in 1941. We were restricted then by the government to being west of the tip of Greenland. Instead of going to east Greenland, which was the original plan, we went to west Greenland and Baffin Bay. I was on the expedition from June until November, 1941. As a matter of fact we got back around the 4th or 5th of November and you recall what happened on the 7th of December. We didn't see but we read later that a German submarine had been spotted in an area that we just came through about the same time. We could not get weather information. Weather information was classified so we had to depend on ourselves to get it. And coming south in October we pulled up behind Resolution Island which is sort of in the Hudson Strait out of Hudson Bay. Beautiful day, calm, chilly weather but beautiful, sunny. That type of pleasant kind of day. I looked at the barograph which I had, and I thought there's something wrong with this thing. There's a curve on the barograph that's just taken a nose dive. It's just gone right straight down.
PAGLIN: Barograph meaning what?
TAYLOR: Atmospheric pressure. I realized later that this was a hurricane ‑ well the edge of it, that we got. The skipper wanted to go across to Labrador across the Hudson Strait, because by this time he and Louise Boyd were at swords point. She insisted on going ashore and visiting all the little villages as we came along. Bartlett wanted to get out of the area because he knew it was beginning to freeze. He decided he didn't want to lay under Resolution Island until the storm blew over either. He wanted to get across. So when we were going across the Hudson Strait the storm hit with driving snow. I never will forget the bow watch, him watching up in front of the boat hollering, "hard to port, hard to port," just screaming at the top of his lungs. Later, down in the galley over coffee, he said, "Those Button Islands came up, I could put my hand out and touch them. We were that close to them." So we steamed for about an hour up the Hudson Strait, then turned around and went 150 miles out to sea and rode the hurricane. But it was wild. We weren't in the eye but we were in pretty good heavy wind. It was exciting.
PAGLIN: How big a boat was this?
TAYLOR: It was 106 feet over all. It was to have led the Tall Ships Parade in 1976 in New York Harbor, but she was in a trading company and coming from Cape Verde Islands to New York was dismasted. She was sold and the name changed to "Ernestina". She's now in the possession of the State of Massachusetts, I believe, up in New Bedford being restored. They're going to use it like Baltimore used "The Pride" as a vessel to travel around. I went up a year and a half ago and looked her over. I hated to see the name changed to "Ernestina". It was "Effie M. Morrissey" to me. When I looked at the name board on the bow of the boat you could still see the 'Ef' on one end and the 'Ey' on the other end underneath the "Ernestina" board.
PAGLIN: Did you go on board?
TAYLOR: Yes, but it had all been gutted and there was really nothing to see on board. They took everything out of it about a year and a half ago.
PAGLIN: So this is a period of restoration?
TAYLOR: Yes, she was still under restoration. I haven't checked on it recently.
PAGLIN: Your function during this expedition was what?
TAYLOR: My function was to handle the equipment we'd been preparing the last couple of years to make soundings of the ionosphere continuously. I say continuous, about every five minutes we would make a sweep that was recorded on 35mm film. My job was to process the film, read it out and make some readings from it. The data was then supplied to the Bureau of Standards and became, at that time, the best information they had at high latitudes.
PAGLIN: This would then have been useful in terms of AM transmissions?
TAYLOR: Predicting long distance communications whether it was AM or FM, but it was not for broadcasting, it was for communications, and so in 1941 everything that was done became totally classified.
PAGLIN: So this would actually be used in high frequency long distance communication?
TAYLOR: No, we swept the frequency from a half a megahertz to 15 megahertz.
PAGLIN: So it'd be military and the carriers as well I mean the international carriers?
TAYLOR: Oh yes. The interesting thing is that after the war was over, I heard about a technique called radar. It happened to be exactly what we were doing. We were sending pulses out and measuring the time that it took to come back. During the period when we were getting this equipment ready in '39 and '40, I had a classmate who was working for the Naval Research Laboratory. We got to talking, because we were getting together socially, about what we were doing. He couldn't talk much about what he was doing, but I would tell him what I was doing. We were both working on almost the same project. He would tell me a little bit and later I realized that he was working on radar doing the same thing.
PAGLIN: Were the results of this accumulation of data published, or did it become part of the National Bureau of Standards (NBS)?
TAYLOR: It was part of the Bureau of Standards. We published an article about the equipment that we built but the data became classified. By the time it could become de‑classified it was pretty much obsolete information, not particularly useful at that time, but it had been.
PAGLIN: When was the article published on the equipment?
TAYLOR: I think 1940 before the war.
PAGLIN: This was the NBS up here in Washington?
TAYLOR: Yes, this was up at Van Ness Street. It doesn't exist anymore. The Intelsat building is up there now.
PAGLIN: We live right across the street on Van Ness and Connecticut and I was so sad to see those buildings torn down. And of course the Harry Diamond Labs were across the street down in the pit.
TAYLOR: Harry Diamond Labs started on the second floor of that building. We were on the first floor and they were on the second floor. Then they moved to the other building. Well that was an expansion building. Of course now they're out in Silver Spring or somewhere.
PAGLIN: They had a marker up there one time before they tore the building down about that was where the proximity fuse was developed, right? And do you know what they still have? You should go up there and take a look. It's now the International Plaza. Intelsat is part of that. All the embassies are up there ‑ the Middle East embassies are up there and they have built the most beautiful park. I must say that for them. Spent tons of money, not the government's. Right there on the hill. And then right in the middle with a stone fence around it and a plaque is the tree that NBS put up, a piece of the Isaac Newton tree and it stands there with a plaque. It's supposed to be a cutting from Newton's original apple tree. Well, what happened after that?
TAYLOR: One of the interesting things while I was at the Bureau ‑ we would go out every Wednesday to a field station where we had, I think, about 6 or 7 field strength recorders running on long distance transmissions to record how they worked. Wednesday we took turns at doing it but we would go out about two or three in the morning and listen for the ham skip change and change the paper on the recorders and fill the pens with ink and that sort of thing.
PAGLIN: Where did you go out?
TAYLOR: It was out in the vicinity of Camp Springs, Maryland. I went out one morning about 4:00, and went to the gate to unlock it and go in, and here's a big sign on there that says "Eviction Notice. You are hereby notified by the U.S. Government that you are evicted as of such and such a date". We were the United States Government. Well they let us stay for quite a while. It turned out that we were right in the middle of Andrews Air Force Base. We were on the road between Camp Springs and a place called Meadows. I don't know whether it still exists or not. Then we went out and found another spot in Virginia. A nice spot way, way out in the countryside and developed this ‑ built a building and towers and all that sort of thing and lo and behold we were right in the middle of Dulles Airport. We were excellent airport pickers.
PAGLIN: How long did you stay with the NBS?
TAYLOR: I was there for about 5 years and came the war and about this time I joined the Society of Friends, the religious society of friends ‑ Quakers. I had developed prior to this some pretty strong feelings about the war, about war in general. The work at the Bureau of Standards was moving so rapidly toward Harry Diamond effort that I began to have serious problems with my own conscience. I took some steps and Lyman Briggs was the director of the Bureau at that time. Finally a decision was made that I would leave, which I did.
PAGLIN: This was when exactly?
TAYLOR: 1943, I believe it was. For a month or so I was unemployed. That isn't a very comfortable situation for a young kid and I was married actually and I had a child.
PAGLIN: When did you get married?
TAYLOR: Back in the 30's. It was about the time I left college. My oldest son was born in 1940.
TAYLOR: I had a call from somebody who said they needed a technician at WMAL radio station, and I interviewed with the chief engineer, Dan Hunter. You may have known Dan Hunter. He was here for a long time as chief engineer ‑ went to Hawaii later. But he told me I'd have to get a first class radio telephone license so I took the FCC examination, and I didn't quite get a perfect score. I made one mistake. I factored one equation. What was it? A squared minus B squared equals zero or something, and I factored it wrong. Something I knew very well but I made a mistake. Anyway I got my ticket which I've maintained in force ever since although it's not so significant anymore. But I worked at WMAL as a transmitter operator for a little over a year I guess it was. That's one of the hardest jobs you ever have to do because there's nothing to do. You're just there.
PAGLIN: You watch modulation monitors and things like that?
TAYLOR: Well you make a recording every half hour of certain meters. Do a cleanup job. Late shift when you sign off the air, things like that. But it was interesting. Got me interested in broadcasting and while I was sitting there doing nothing I'm reading Broadcasting Magazine and there's an advertisement in there for a consulting engineer. So I went to Dan Hunter and I said, "What's a consulting engineer?" He told me a little bit about it and I decided to answer the ad which I did and it was Paul Godley up in New Jersey. I went up for an interview. Paul had been very ill. I think it was just an appendicitis, I believe. Sulfa drugs had just come into use. It was a wonder drug and while he was open on the operating table they just sprinkled sulfa through and it made him sick as a dog. He thought he was done. He could have hardly been 60 years old at the time but he just didn't have any energy, no nothing, and thought he would retire now and that was the end of it. But when he began to feel better he wanted to get his business going again and I came back in. He had two young fellows that had been with him for well before the war started. Then they went off to the war, then came back, so he had these two young fellows that were working with him.
PAGLIN: Do you remember the call letters of the station?
TAYLOR: No, Paul Godley was a consultant ‑ consulting engineer. One of half a dozen prominent firms. Paul Godley had been the guy who went for the American Radio Relay League, the amateurs, to Scotland in 1920 and set up a receiving station over there with the attempt to receive American transmissions. Very successful and became quite famous for the Scottish trip. I was on the cover of QST for the 25th anniversary of that trip. He had a picture of all our office on the cover in front of a drafting board. I think there were about four or five of us at the time. "Doc" Brown, George Brown, of RCA had been a partner of Paul's prior to the time I went there. Robert E.L. Kennedy had been a partner. He also was prior to my time there. But while I was there Murray Crosby came in as a partner. Murray was the guy who had the FM patents that eventually were honored by the courts against Major Armstrong. Long bitter fight.
PAGLIN: I remember I came in at the tail end of that in '49 when I joined FM at the FCC.
TAYLOR: Of course, ultimately it ended in suicide for Major Armstrong. A tragic situation. Paul Godley had been a partner of Armstrong's at one time. He went back through all the early history. Worked with Lee DeForest as a lab assistant at one time. It was interesting to talk to him. He's gone now. In about 4 or 5 days my father would have been 100 years old. His birth date was in 1887. And I believe that Paul Godley, and my father were contemporaries about the same age. Paul's been gone for probably eight or ten years.
I spent just about three years with Paul. Having been born in Colorado, and incidentally one of the ironic things was that, after I left the Bureau, a whole group that I was with at that time called the Central Radio Propagation Laboratory, CRPL, moved to Boulder, Colorado. I had never quite gotten the west out of my blood. I just always wanted to go back west. I loved it back there. Having learned something about the consulting business I thought maybe I could go back in the Northwest somewhere or in the west and make a living as a consulting engineer. A lot of field work was to be done out there, and I could see that there were uses for such people. Even if it doesn't work I knew a little about the broadcasting business, and I ought to be able to get a job somehow in broadcasting, even if I can't make it as a consultant. So let's do it.
PAGLIN: So this was around '46?
TAYLOR: Late '47. We went in September/October of '47. Forty four I went with Paul Godley but my wife and I decided we'd just go to Longmont. That's where I started. I had a trip out there somewhere ‑ Denver, Boulder, somewhere, and took time to go through Longmont and decided this is not for me. Can't go down there.
End of Tape 1, Side A
TAYLOR: The fact that my father left over the Ku Klux Klan was an indication that it's still a pretty non-progressive type community. Besides, it was getting to be too close to Denver anyway and I really wanted to be away from a metropolitan area. I wanted to be in a place that stood on its own, a relatively small town. So about that time I met a fellow who came from a fairly large family in Montana. He was living in Montclair, New Jersey, at the time when we were. We were visiting and he said, "Why don't you go to Missoula in western Montana?"
PAGLIN: Who was this person?
TAYLOR: Leo Baldwin. The Baldwin family was really quite a family. The father ran a bee ranch of all things. Honey bees. And, of course, you scatter the bees and hives, bee yards all over the countryside. he had them 150 miles away. To show how large a ranch he had, during the war sugar, of course, was rationed. You couldn't get it. He had 10 tons of sugar in his barn because there comes a time in the spring when the bees begin to be active and there isn't any nectar for them. You have to feed them. He had ten tons of sugar in his barn.
He said, "Why don't you go back there?" He got me some literature from the Chamber of Commerce which I looked at, liked and decided I'd take a vacation and go out there, which I did. Leo left me a car at the railroad station in Missoula so that I could have a car to drive around. I spent about two weeks driving all around the area., and I just absolutely fell in love with it. It was wonderful, beautiful, wonderful country. Went back and we packed up our belongings and had them shipped out. It was pretty gutsy. We didn't have very much money, and didn't know whether I could make it as a consultant or not, but fortunately I got sub‑contracts from a couple of the fellows here. Worth Lent, for example, hired me to do a job. Jim McNary hired me to do a job. These got me through that first winter. Then we began to do reasonably well. At least we were surviving when the war time freeze on television came along. Of course, everybody knew then that radio was a dead duck, television would eliminate radio. So radio people weren't hiring me. Television wasn't hiring me, and now what do I do.
PAGLIN: That was the 1948 freeze. Yeah, it was in '48 to '52. That was the freeze.
TAYLOR: Yeah, somewhere about then. I went to the University, and talked to the head of the physics department to see if there were anything I could do in the laboratory or something. They took me on, and at my choice I went on part‑time, three quarter time because I wanted to still retain my ability to do my consulting if it came on. So I did. I worked for the University for about 5 years. At that time it was Montana State University, but they changed. It's now the University of Montana.
PAGLIN: You were doing part‑time work as what?
TAYLOR: Laboratory assistant in the physics department. Then the journalism department decided to move into the television field, and I worked with them building a closed‑circuit studio at the University. Then I taught a couple of courses on just basic electronics. It was interesting. It carried me over, and by being part‑time, I was able to begin to do consulting work. It's interesting that one of my clients was a young kid who was still in college over in Bozeman which is now known as Montana State University, but then it was Montana State College. You know how those changes happened all over the country. This young kid called me and said he wanted to build a radio station. I don't know where he'd gotten my name, but could I help him. And I said, "Sure come on over and see me." So he came and that turned out to be G. Norman Penwell. You probably also know him. I helped him get the license application and he got a CP, and I helped with his license.
PAGLIN: At Bozeman?
TAYLOR: At Bozeman. AM Class 4 radio station. About that same time I had a call from an assistant attorney general of the state. It came first from an associate justice of the Supreme Court in the state of Montana, a man by the name of Lee Metcalf.
PAGLIN: The Lee Metcalf? I didn't know he was a judge.
TAYLOR: Oh yeah, he was an Associate Justice of the Supreme Court of Montana. He had been conned into a radio property in Helena, Montana. I tell you he was terribly conned. He and some other people. There was a prominent doctor in Helena. This crazy guy took these people to the cleaners. It was atrocious. They had bought four 400 foot, self‑supporting towers sitting on the ground out there. They had buried the ground radials for a 570 kilohertz AM radio station, and you know how long those damn things had to be. The copper was in the ground. The concrete pedestals for these towers were in the ground. The towers were lying on the ground and they didn't have a construction permit. They had nothing but an application. So along comes a station down in Nampa, Idaho, on 570 kilohertz and they protested the application. This was when Lee called me in. He said, "We've really got a problem here, and we don't know what do to." Well, I almost flipped when I saw this stuff. They had built a studio. They rented three offices in a downtown office building, had bought an enormous array of Gates Radio studio equipment... they had turntables, of course, they were all discs at that time. An enormous amount of stuff. They bought two automobiles and this was a time when you couldn't buy cars. He had a Fraser Manhattan and Kaiser. Two automobiles they bought. They hired a secretary, and the guy who was promoting this, Guy Mallon, began hanky‑panky with the secretary, and he lost his wife over it.
I got them out of the 570 thing. I said the thing to do is go for a class 4. I changed the application, and we got them the permit.
PAGLIN: How did you get around the Section 319 problem of building without an FCC permit? Did you hire a lawyer here in Washington?
TAYLOR: I worked with both Fred Albertson and Vernon Wilkinson. I think it must have been Albertson at this time. I can't remember. The 319 problem, I don't know how that was taken care of. It was a kind of a situation where they had so much money invested already, there was no way they were ever going to recover it. So what Lee and the major partners did was to buy the land, build the building and then lease it to the corporation. I think they came out fairly well. Lee Metcalf's friend and helper in this whole thing was Al Dougherty who was a deputy attorney general at that time. Were you at his house up there in Helena?
PAGLIN: No, I've never been to Helena.
TAYLOR: He bought a house and did a lot of remodeling. Did it all himself. Being a deputy attorney general, and he had managed the successful campaign for John Bonner to become Governor, I found myself all of a sudden sitting in the living room at a social gathering with the Governor of Montana. Really something. Al, of course, was a political animal and he was involved in politics. So then come 1950 or '51 things were very, very slow. Salary from the university wasn't very much and the consulting was almost non‑existent. There was a notice in the newspaper that Missoula County had just changed from a 4th class to a 3rd class county because of the population and valuation assessments and that therefore they would be required by the State Constitution, I believe, to have an auditor. That had not been required previously. Before the Depression they had been a 3rd class county that had to have an auditor but then they dropped in valuation and didn't have to have one. So they were being required by the Constitution to have an auditor.
Well, my wife was an accountant educated at Ben Franklin University down here on L Street and 16th. She said, "I'm going to run for that two year term elective office." So she got busy and ran. It was an interesting campaign. The county commissioners didn't want the auditor. They did everything they could but they couldn't beat the Constitution. They tried to not have an auditor. Tried to get a waiver. Everything they tried to get out of it but they finally had to have it. So they picked the man that would be the auditor and he'd be friendly to them and he was going to run. He ran a campaign. I'll never forget the political meeting we were in ‑ he got up and said, "Well, I hope that Mrs. TAYLOR:, should she get elected, that she's got a lot of knitting to do, because there really isn't anything in that office to do." And essentially sat down. Laverne got up and said, "Well, I'm going to do nothing but sharpen pencils and get to work because I know there are lots of things to do in that office and I know how to do it."
We had also begun teaching square dancing around the county. We'd go to the rural schools and we'd teach square dancing all over the county. I had Ed Durlacher's records. He was the caller. They were excellent calls. They were easy to understand and simple maneuvers so that it was a good thing to use to teach. I would walk them through the pattern then we'd play the record. If they got all mixed up I could stop it and we'd start over again. So we got to know people all over the county because we were going into these country schools all over the place and they'd run a party. They'd bring their lunch and about 11:00 at night they'd all stop and have sandwiches.
PAGLIN: Were these kids or adults or both?
TAYLOR: These were adults. Farmers with red faces and they'd never done any dancing in their lives but they had a whale of a time. We got to be known all over the county and I've always maintained that what elected Laverne was the square dancing that we did.
Another curious incident, another man who was running for the office, also selected by the ‑ he was a Republican ‑ commissioners as a good man that they could trust, died election eve. Just before the election he died. He died too late for the newspapers to carry the story. So the election was held with him on the ballot. Well, Laverne won in spite of that. The commissioners tried then to say the election was invalid because the candidate was dead and you've got to start over again. All kinds of things to try and defeat her but she finally was certified. In the meantime, the budget that they'd prepared for her office, they just transferred it to some other part. There was no office there at all. No salary, no help, no furniture, no office for the auditor. She reported on January 1 or whatever the official date was and there was no place for her to go. No office, no nothing. Well, she fought, I guess, for about a year and in the course of it we went to Al Dougherty and said, "There's got to be some legal way to bring action, to force these guys to give us an office and a typewriter and an adding machine and a deputy and so on." So Al said to me, "Okay, this is a tough case. It's an abuse of discretion case because the commissioners have large discretionary powers, and we'd have to prove that they'd abused their discretion. Al was a lawyer and he said, "That's hard to prove."
TAYLOR: So he wanted an advanced payment of $500.00. Now in our financial condition that could have been a million dollars. So we gave the $500.00, he took the case and won in the local court, the county court, and the county commissioners appealed it in the State Supreme Court, and we won in the State Supreme Court. So Taylor ex rel County Commissioners is a case on the records in Montana Supreme Court.
PAGLIN: The title caption of the case is what?
TAYLOR: Taylor ex rel County Commissioners.
PAGLIN: And this was about when?
TAYLOR: Oh this would be '51, '52, '53. Some time in that period, I'm not quite sure.
PAGLIN: So where do we go from there?
TAYLOR: By 1953, Laverne was pregnant with our daughter, our last child, and she was being sued by the county sheriff.
PAGLIN: Sued by the sheriff? For what?
TAYLOR: For not approving some bill or other, I forgot what it was, but she was on the witness stand in court, I think it was two days after Margaret was due. Judge Comer was terribly concerned, "Mrs. TAYLOR:, are you all right?" He didn't want that baby born in his courtroom. That was 1953 ‑ when my daughter was born.
PAGLIN: So what happened with the sheriff?
TAYLOR: Oh, she won the case.
PAGLIN: The baby held off until she got off the stand?
TAYLOR: Oh yeah, in fact Margaret was a couple of weeks late.
PAGLIN: Oh, I see, that's funny.
TAYLOR: Some time, the end of 1952, early 1953, Norm Penwell, as I said was one of my first clients, a young kid still in college, he now had his radio station, and he called me one day and he said, "What do you know about Community Antenna Television?" I said, "Well, all I know is what I read in Electronics Magazine, and that isn't very much." Well, he said he had some due ‑ bills from his radio station from a flying service, and he was planning to cash in some of those due ‑ bills, and fly over to the west coast, to Astoria and Chehalis, Centralia, and Bellingham, and Seattle, and see, you know, what we can find out about this Community Antenna Television. Would I be willing to go along with him? So, yeah, I'd be glad to do that.
PAGLIN: This was in 1953?
TAYLOR: It was either late '52, or early '53 again, I can't remember when exactly. Probably late '52. And so, we did. I took two or three days off and we went first to Chehalis and Centralia in Washington, visited there, looked at some systems, appalled at some of the things we saw, the way that they were building systems and so on. We went down to Astoria.
PAGLIN: Who owned the systems in Centralia?
TAYLOR: In Chehalis and Centralia was a guy named Jack Zeckman, who later turns up, and I'll mention him later on, but we never could find Jack Zeckman. The address that we had was in a vacant lot, so we figured we had the wrong address or he was escaping the sheriff or something (jokingly). But anyway, we couldn't find him. Then we went down to Astoria, and met with Ed Parsons, and looked around his system, and he told us his story. Ed's people were building their own cameras for a closed circuit operation, sheet metal. It was flimsy and flopped around and they were showing us what they were doing. Then we went up to Seattle...
PAGLIN: Before you do that, from your knowledge, you know the controversy over who "invented cable television". In the Cable Museum's archives now, there's a picture (amongst others) of Fred Ford and Ed Parsons in 1968 I guess, with the marker, dedicating the first cable system. I think you were there.
TAYLOR: Yes, I remember. I don't think I was there at the dedication, but I knew about it.
PAGLIN: But the marker of the so called the "first CATV system" certainly on the West Coast, the accepted tale (and I just want to get your reaction) is that cable television was a case of what they call simultaneous invention, and that Parsons on the West Coast, and whoever it was on the East Coast, whether it was Walson or Tarlton, or Malarkey or whoever. But it happened at the same time, not knowing anything of each other's operation, but just as necessity required.
TAYLOR: I think that's the fair thing. It probably was a case of at least near simultaneous. In moving from Montana, I lost a copy of Popular Mechanics or Popular Science, and I believe it was dated 1948 or '49 that had a story about Parsons and that story about his television distribution network. But I can't find it‑ it apparently got lost in moving.
PAGLIN: But that should be found, it's either Popular Science, or Popular Mechanics.
TAYLOR: That's my recollection of it ‑ the one that had the smaller size, I think it was Popular Mechanics, '48 or '49, it had a story about Parsons. Of course we were there in '52 or '53, so he'd been in operation for a while. He had a radio station, KAST in Astoria, and that was his base, cable television was a hobby, an interest.
Now as to the Pennsylvania situation, the way I've gotten the story, first of all, Tarlton had recognition initially as the first commercial cable system. What one might call that when you went out and bought the equipment and then built it. Probably that still stands, because Marty Malarkey says that he was two or three weeks later than Tarlton, and Marty doesn't claim being ahead of Tarlton, although they were really quite simultaneous. The other thing in Pennsylvania, of course, is our friend John Walsonavich who claims that in Mahanoy City they were building earlier than Tarlton, and they probably were. Whether they were building earlier than Parsons is one of those issues that we'll never know the answer to, like some of the Iran Contra things.
PAGLIN: So this is a fairly well accepted historical theory.
TAYLOR: Yes, I think the credibility of Parson's thing in Astoria, exceeds the Mahanoy City. Mahanoy City was where they had lots of credibility problems. But Astoria and Parsons are well established and credible. I think they were proper to put the monument there, rather than Pennsylvania, but it is true, that it was a simultaneous occurrence. Well, it's like Marty always said, how are you going to sell television sets if you don't have a way to receive television. He had a music store that he owned, and wanted to sell television sets, and it's all there in his oral history.
PAGLIN: So, go back if you will to your visiting Parsons.
TAYLOR: So, then we visited Seattle, and this is kind of an interesting thing, we looked up Phil Hamlin, who we'd been told to look for, at that time Phil was still working with Holert Electric in Seattle, an electric company. He had just been appointed the head of Jerrold Northwest division, and was within a day or two of leaving Holert. We stopped and talked to him and got to know him over the years. This would have been the same trip, either late '52, early '53. Then we went up to Bellingham, (Washington) I can't remember the name of that guy... he was an engineer with KVOS broadcasting station, and he literally built the TV plant, and I mean literally built it, the transmission lines were built from water pipe, the antenna was made out of water pipe, this is the broadcast station. Rogan Jones was the money man, the owner, and this other fellow, Harper, Ernie Harper, was the engineer, and he built KVOS television plant. But he also built a cable plant in Bellingham, so that we visited that one too.
PAGLIN: What was the size in terms if you know, subscribers at the time?
TAYLOR: I really don't think I know, I really just have no idea. I'm sure they were not city‑wide in any case, you know, just areas, looking for the places where they could most likely get some revenues, was what they were looking for, and that were together so they could wire them efficiently.
Well, Norm and I went back, and we decided that we would try to build a cable system, but where should we build it? Missoula seemed like the most logical place, it was in the mountains, and that's what cable is all about, being in the mountains, closer to Spokane, which is where the only TV station was, channel 4 at the time owned by our great and good buddy and enemy, Ed Craney, Mr. Northwest.
PAGLIN: Yeah, but wasn't Ed based in Montana?
TAYLOR: Yeah, Montana.
PAGLIN: But you said Spokane.
TAYLOR: Well, the TV station was in Spokane.
PAGLIN: Oh, channel 4, yeah.
TAYLOR: But then he had a station in Portland, and he had one in Ellensberg, he had two or three stations in Washington, and one in Portland, and several radio stations in Montana. Montana was his original base.
PAGLIN: That's how I always knew Craney, in Montana.
TAYLOR: So, Pacific Northwest was his territory really. He was not as strong in the far Northwest as Elroy McCaw. McCaw was the kingpin back there.
PAGLIN: Of memory too.
TAYLOR: Craney had the TV station, it was up on Mount Spokane which was over 6,000 feet high elevation, and consequently could get out reasonably well. Well I lived on the north side of Missoula and about a block, two blocks from my home was a mountainside that went up, well a foothill really, not a real mountain. And so we went up on the top of that, which was called Waterworks Hill, for an obvious reason, there was a reservoir up there. We set up a tent and had a generator for power and put up an antennae and we got television pictures. Well, we had a whole stream of people, coming up the road, the lane to get up and look at television, the first television that anybody had seen in that part of Montana.
PAGLIN: In the shack there.
TAYLOR: Well it was a tent. Now we were just doing it for testing purposes, but people would come up to look at it. We ultimately did build a shack and put a plate glass window in it with a TV behind it so everyone could see it.
PAGLIN: And this was exactly what date are we talking about, can you recall?
TAYLOR: Well, this would have been early 1953. Because our corporation was organized in May of '53.
PAGLIN: What was actually the name of the system?
TAYLOR: Northwest Video. Well, Norm had contacted Mountain States Power Company to see about using poles, or the Mountain States Telephone, to see about using their poles. The power company said, "Heck, we don't care, doesn't bother us". The telephone company said well, we'll have to have a lease agreement on it. And meanwhile, Pat Goodover, who was Craney's operator of the radio station in Missoula, decided that he, with Craney's money, would build a cable system in Missoula also. So he had gone to the telephone company, and the telephone company's way of dealing with this was "Ok, we'll talk to both of you, you come in, and we'll make an appointment on the same day, we'll talk to Goodover first, and then we'll talk to you guys." So, we went to the meeting all right, but we took one look at Craney's money, and we said boy, there's no way we could win a cable race with these guys. If we have to start building cable together, they'll outdo us every time. Let's find some other place where we can go.
So we went up to Kalispell which was 125 miles north of Missoula, and got things set up. That was a non‑Bell telephone system up there, in fact, it was one of the few places in the country where the telephone system was owned and operated by the power company.
PAGLIN: Yes, there were a few instances.
TAYLOR: Yes, there were a few, but not too many. It was Mountain States Power that ran the telephone company. The power company was eventually sold to Pacific Power and Light, and PP&L ran the telephone for a while. So we went up there and we started raising money. Meanwhile, let's see, it was myself and Norm Penwell, and Norm's cousin Jack Penwell, who died about 2 years ago, whose mother had some money that she was willing to put in, and another radio amateur experimenter, hobbyist, in Missoula by the name of Bruce Hamilton. So really the four of us constituted the corporation, except that we went up into Kalispell and we started selling stock to whoever we could.
PAGLIN: Did you still call it, Northwest Video, the same corporation?
TAYLOR: Oh yeah, not until we sold it to H & B American, never changed the name of it. But we sold stock in Kalispell to a number of people, one was a cashier in a bank, fairly prominent business people, one was an attorney, I can't remember who all they were now, but it wasn't anywhere near enough money. We were like everybody else, undercapitalized, dependent on the installation charge of $135.00. At that time the going monthly rate was $3.75 per month. We had several problems, the first of which was obviously by this time we knew that Jerrold was a primary manufacturer of equipment, but Jerrold would only sell to us on the condition that we signed a service agreement.
Well, what's a service agreement? Well, we want $5.00 out of each installation charge, and we want 25 cents a month out of each monthly fee. They conveniently forgot to put a termination clause in the contract, so it ran forever, their hand in your pocket. Well, what'll you do for us? Well, we'll keep you posted on any new developments that come along. Well thanks a lot, we can get that from the trade press. We'll review your system design so that we know it's done right. The ostensible reason, the rational reason for the service contract was that a manufacturer like Jerrold couldn't afford to just sell equipment, couldn't just sell hardware. You had to sell a system that was put together, otherwise the hardware would have been blamed for a poor system design. It's a logical and a sound reason.
There we were. We had been selling stock to these various people, on the basis that we're four engineers; that if we don't know exactly what to do, we certainly know how to find out, and how to do it. We should now go back to them and say look, you're going to put Milt Shapp's hand in our pocket because he thinks that we don't know how to do it. Well, there was no way we could do that, so I tried every subterfuge that I could to get to Milt Shapp and to Phil Hamlin. Everything I could do. But it always ended up, you've got to sign the contract. So we wouldn't do it.
Well about that time International Telemeter, down in Los Angeles, was building a device they called Amplivision. It was a distributed amplifier, and as I learned later from Fitzroy Kennedy of Spencer‑Kennedy Labs, was patented by Fitz Kennedy and International Telemeter was infringing it. They just did it. They weren't licensed, and Fitz didn't have enough money to sue. But we didn't know about Fitz Kennedy until later. We bought the Amplivision amplifiers for our first construction.
Now these things consisted of two stages of 6AK 5's in a distributed amplifier system, which meant there were twelve 6AK 5's in each amplifier, and those were fairly expensive tubes. They cost, I think, $3.50 at the time, which was big money for tubes, and twelve of them. We made the engineering mistake of going by the technical literature on the amplifier, which said that they could be spaced 40 dB apart, or they had 40 dB of gain, so you could put them 40 dB apart. What we didn't realize, what we didn't think about, is that those tubes age and as they age the gain goes down, and if we'd spaced them 30 dB or 25 dB, they'd have had some headroom to come down and still work, but as it was, they almost immediately began to go bad. So we found ourselves changing 12 tubes on each amplifier every three months, to try and keep up with it. That wasn't any good, that wasn't going to work.
RCA was selling what they called Antenna Vision, and Marty got in on that one, that was his first amplifier. It was a great big box probably two and a half feet wide, and four feet high, and weighed God knows how much, terrible, terrible thing. We bought three of those, and they were even worse. They didn't even work properly. That was very poor equipment. Well then, another fly‑by‑night outfit by the name of Blonder‑Tongue, produced an amplifier called the MLA amplifier. It was a split band amplifier, with low VHF and a high VHF, and it cost $99.00. And it turned out to work very well, we didn't need but just the low VHF band, because all we had was one channel at that time, well we did have two channels, because there was a station in Missoula at the time, Art Mosby.
PAGLIN: His station?
TAYLOR: His station was in Missoula.
PAGLIN: You're saying that the original system, when built, had one channel. What did it carry?
TAYLOR: It carried KXLY in Spokane. Craney's station in Spokane. It was 160 miles away.
PAGLIN: And this was just line of sight?
TAYLOR: Line of sight would be at an elevation of about 20,000 feet which we didn't have.
PAGLIN: How do you get the signal?
TAYLOR: Diffraction pattern. We probed and found a spot where we could receive Spokane and it was a situation where we put our program antenna up in a spot and we could get a picture but if you moved it left or right or up or down, you lost it. It's just a real hot spot.
PAGLIN: And that spot was how far out of town?
TAYLOR: Oh it was on the north edge of town. Not too far out of town. Usable.
PAGLIN: And that was by diffraction?
TAYLOR: That was a diffraction pattern. Coming over the mountains. That was how we started on the one channel. Then we tried to get Missoula Channel 13 which was also on a mountain outside of Missoula, about a 7000 foot mountain and my recollection is that it wasn't very good but we did finally have it so we had two channels. It wasn't very long before NBC and ABC affiliates came on the air in Spokane but not up on the mountaintop ‑ they were down at the town level. Channel 4 ‑ KXLY was CBS. Craney's was CBS, so it was ABC and NBC affiliates which came on channel 2 and 6. They obviously couldn't be received by direct reception because they were not at that high elevation. In the meantime, and I'm not sure of dates here, Bill Daniels had succeeded in breaking down the microwave prohibitions so that we could have microwave. Also two fellows had built a system in Missoula, not Craney's guy, but two other guys. The funny thing about that is that these 2 guys lived in Kalispell. We went to Kalispell and built a system. They went to Missoula where I lived and built a system.
PAGLIN: Did Craney give up? He didn't build a system?
TAYLOR: Evidently. No, he didn't build a system. I think he decided to fight it instead of join it. Dick Geis and Fred Plummer had wanted to build a TV station in Kalispell and one of the interesting things and I don't seem to have a copy of that letter although if I dug through my old files I might find it. They wrote to NBC and got a very interesting letter back from the station's relations department that said you're too small in Kalispell. There are not enough homes to justify putting in a TV station. Why don't you build a cable TV system?
PAGLIN: NBC told them that?
TAYLOR: NBC told them. This is still in the 50's, probably the latter half.
PAGLIN: That's something I never heard before.
TAYLOR: It's been in testimony at the Congress and probably at the FCC.
PAGLIN: Probably at those hearings in the 60's.
TAYLOR: A letter from NBC that recommended that they build a cable system.
PAGLIN: Figured they'd pick it out of Spokane.
TAYLOR: Well, they had the same problem we had. They went to Missoula and built the system there while we built the system in Kalispell. I think they had more money than we had to begin with. Sold some stock also. They then went into microwave because they couldn't get signals very well where they were and they went to Big Mountain which is about 20 miles north of Kalispell over 7,000 feet elevation. They built microwave and we leased service from then so we could get Channel 2 and 6 also. That got us the three channels and we were able to get sort of Missoula ‑ not very well but we did get Missoula. So we had four program channels and you could use, in those days, the low VHF was 2,3,4,5,6 ‑ there was five channel availability.
PAGLIN: You had 5 channel availability.
TAYLOR: Yes, the MLA amplifier. The Blonder‑Tongue amplifier was a low broadband amplifier that would handle all 5 of them. So somewhere along there we put in one of these weather boards from Bruce Merrill that sweeps back and forth and looks at the meters. When it got to the end of the scale and was looking around there, there was a blank space and we put in an advertisement there.
PAGLIN: You were going to do what?
TAYLOR: A couple things I should back up and tell you though. In the early days we just weren't selling very much. You'd go into a major department store in Kalispell and ask about a TV set and the salesman said, "Oh yeah, we got just one of them sitting over in the corner." And he'd go on about his business and you could go look at it if you wanted to. They were selling real hard. People weren't buying our service, they weren't buying TV sets.
End of Tape 1, Side B
TAYLOR: So, one of our major stockholders said when are you going to come over on my side of town with the TV. We'd been told by Phil Hamlin and others on our trip that it was the working man's part of town that were the best customers. So we went in the working man's part of town ‑ the obvious thing to do. Well, when are you coming over on our side of town ‑ everybody wants it over there. By golly, we didn't have enough money so we tore down the plant over here and moved it over there.
PAGLIN: The whole plant?
TAYLOR: Well enough to get started anyway. They didn't buy either.
PAGLIN: What about the subscribers?
TAYLOR: We didn't have any. We took down a plant that didn't have any subscriber's and we moved it over to the other side of town and they didn't subscribe either. They all figured we were fly‑by‑night and literally we were. But this major stockholder was the cashier of the bank and I don't know whose idea it was. Was it ours or his, but the idea was that they would take paper from the dealer on the $135 installation charge. So you go buy a TV set and the TV costs, let's say $250 and then you put $135 on that and we'll take the paper for $385. That got us over the hump. That got us the $135 that we could then use to buy more cable and they'd only sell us cable C.O.D. and we'd have to go down and take a check to get it out of the warehouse. Little by little we began to make it.
PAGLIN: And that's actually the way it started. Do you remember his name?
TAYLOR: The cashier. Well, if you hadn't asked me I probably would have. Hubert Bell was his name.
PAGLIN: If I hadn't asked you?
TAYLOR: You knocked it out of my mind. I don't at the moment. Maybe it's just as well not because, I imagine, a good bank examiner would have criticized that pretty severely.
PAGLIN: The story about the bank cashier is much like the story that Bill Daniels told, in a way, about raising local money, in his oral history, this guy, if I read you correctly, was the key to opening up, in effect, the system.
TAYLOR: No question.
PAGLIN: By that gimmick.
TAYLOR: This triggered being able to do it. Of course, later the IRS ruled and the courts ruled that we had to pay tax on that $135. By now we're over the hump paying the tax on it didn't bother us.
PAGLIN: Would this be a convenient place for you to stop?
TAYLOR: There's one thing while we're in this date that I ought to put in here.
PAGLIN: Please do.
TAYLOR: It was November 1953 when I decided to test out Newton's laws of motion and I fell 32 and some odd feet and smashed myself up.
PAGLIN: I remember your telling me. What actually happened?
TAYLOR: I was installing loudspeakers for the University field house ‑ a brand new field house and we had a scoreboard out in the middle of the arena. I was installing the loudspeakers because I designed and had put in the public address system. I talked to the manager about the plans on it and he said to me, did you ever tie a Bosn's chair and I said, "No, I never did, but I've been a boy scout and I know how to tie knots." Oh, no, we're not going to do anything amateurish. We've got steel riggers out here who know how to do this. They'll rig up the Bosn's chair for you. So we did. I used the Bosn's chair and I got myself up to the place, working along and I'm ready to leave and finish the job. This is in a field house and the floor was a mixture of sand and clay and put in deliberately. The wood floor wasn't in yet. It was all sand and clay. Fortunately it was kind of powdery and very dry. So I got ready to leave and I came down and I had gloves on to handle the line.
PAGLIN: The pulley.
TAYLOR: Yeah, block and tackle. It was, I think, 3 sheaves on 1 end, 2 on the other end.
PAGLIN: How high up were you at that point?
TAYLOR: I was about 30 feet in the scoreboard. I took hold of the line and started to let myself down and the next thing I know I'm lying on the ground with a very sore back and the board that I had been sitting on under my back. They tell me that I fell, free‑fall straight down and landed on my feet and kind of fell over. Well they picked me up and took me to the hospital. I broke heels and ankles and got all smashed up. The bottoms of the leg bones were broken. The pelvis was broken. The sacrum was broken. The 5 lower vertebrae were all telescoped.
TAYLOR: Compressed. Later on I had some broken ribs that were bothering me. So it was touch and go for a while. They put me on a traction bed which they raised me in the middle and pulled my spine back out. To save the vertebrae they pulled them out instead of going into surgery.
PAGLIN: And if you did, all the discs would fuse.
TAYLOR: No, they didn't do surgery.
PAGLIN: I'm saying if they did.
TAYLOR: I guess they examined the X‑rays and decided they stood a good chance of being able to do it without surgery and if they could it was less risky and they were right.
PAGLIN: And there was no spinal injury.
TAYLOR: Other than that. For a while I was paralyzed. My legs were. I can remember seeing them come in with a needle and scratch my leg and no feeling. But that gradually returned.
PAGLIN: This was from the trauma of the spine.
TAYLOR: I suppose. I still have crossed wires ‑ places on my leg where I can touch it here and feel it over here.
TAYLOR: Some places are numb.
PAGLIN: When we first met, I remember in the early 60's, I was in practice when Fred Ford came on as President of the Association and you were on canes at the time.
TAYLOR: Well, I still carry a cane. I had casts on my left foot for about 2 and a half years. But I was out of the hospital in 10 weeks. Then in a hospital bed at home. And gradually began to move. While I was in the hospital bed still, Art Mosby was an interesting guy. A lot of people criticized but he was awfully good to me. He came to me and said that he wanted me to prepare an application for a TV station in Missoula. I know he did it as therapy and he came to me to do it. I had worked for him before.
PAGLIN: Well, that's interesting.
TAYLOR: In some ways, I was not in on the early development of our system because we incorporated in 1953 (May) and I was injured in November. It wasn't until '55 probably that I was really circulating very much.
PAGLIN: I want to fill in a couple of spots from my notes. Was Kalispell the first CATV system you were involved in?
TAYLOR: That's correct.
PAGLIN: And what, actually was your formal position there?
TAYLOR: Well, I was one of the founders of the corporation and we were in a group of four engineers and technicians who put the thing together and served you know, as a team. I don't remember titles. I don't remember how we divided up corporate titles.
PAGLIN: Did you have an ownership position?
PAGLIN: Now who was the formal head of it at the time?
TAYLOR: Well, I suppose that Norm Penwell and I pretty well shared that. The others came in not very long subsequently, but we brought the others in. So really the two of us, Norm and I served in that capacity. Who had the title president, I don't remember. It was only a few months after we had organized this corporation and got it started that I had my accident, so I was taken out of service for at least a year, a year and a half. Norm had come to visit me, and the others had come to visit me, and tell me what they were doing. So I kept track of it, but I was really out of circulation as far as active participation for that period.
PAGLIN: Now, tell me a little about Norm Penwell; what's his background. How did you meet him?
TAYLOR: I think I related that, but I'll repeat it. Norm was student at Montana State College in Bozeman in Engineering Physics.
For some reason or other he was out of school for a period, and so he was a little bit older, as a college student, finishing up his course in Engineering Physics. While he was still a student, he called me. I had just opened my consulting office in Missoula. I don't know how he found my name, but he called me and said he wanted to build a radio station in Bozeman, and would I be in a position to help him. I was a consulting engineer at that time. He and another college student came over to see me, I don't remember who he was, in fact he's kind of disappeared from the scene, as far as we're concerned. They came over, and we talked about it. The upshot was that I prepared an application for him to the FCC for a Class 4 station in Bozeman. I did the frequency search and so on. When he got it built, I went out and made the measurements for permanent license application and so forth. That was how I first met Norm.
Then in, as I said late 1952, early '53, he called me and said he was going to use a due bill, in his radio station, fly over to the west coast and look at some community antenna systems, as they were called in those days. That's how it came about.
Now there's one point that had occurred to me later. I said that when we had gone to Centralia and Chehalis in Washington we were looking for Jack Zeckman, who had built those systems, and couldn't find him. The address we had turned out to be a vacant lot. Well, subsequently, Jack Zeckman had turned up in Missoula. He came and talked to the City Council, or one of the council members who happened to be John Vance. John was a good friend of mine and my family's. John told Jack Zeckman, he said, "You don't need a franchise if you're going to use the power poles and the telephone poles. They're all franchised by the state and if we don't like what you do, we go to the state and they'll take action with the telephone company. So you don't need a franchise." He said, "I'd love to take your money and your franchise fee, really but you don't need one." And to this day, they do not have franchises in Montana. It may be the only state, but I have heard that there was another state, and I don't know which one it was, or is, that has no franchises.
PAGLIN: So, in other words, if the proposed operator can work out a deal with the power company or the telephone company to put his cables up there, that's it.
TAYLOR: You know, he always has to have a lease agreement to use the utility poles. The position that John Vance, who is a lawyer, took was that we the city have plenty of protection. If we don't like it, we'll go to the telephone company and tell them.
PAGLIN: It seems like a pretty sensible system there, wouldn't you say?
TAYLOR: Yeah, and as far as I know, there may be one other state, but it's not been widely used. John Vance, incidentally, then later came back here to Washington, with the Bureau of Indian Affairs. I bump into him every once in a while in Washington ‑ very interesting guy. Competent lawyer.
PAGLIN: He was then on the City Council in Missoula. Did Zeckman build his system?
TAYLOR: No, Zeckman opened up a TV repair shop in Missoula, did some mobile radio repair work, that kind of thing, but he never did anything about a cable system in Missoula. As I mentioned earlier, Ed Craney's man, Pat Goodover and I went into the Mountain State's Telephone Company to sign a lease on the same day. Then it was obvious to us that we had a cable race, and our limited funds were such that we couldn't win a cable race against Ed Craney. So we pulled out of that and then went up to Kalispell, the nearest good‑sized town.
PAGLIN: Knowing Ed Craney's position in these matters, would you characterize this as having some such purpose in mind? He certainly wasn't interested in CATV.
TAYLOR: Pat Goodover told us one time to our face, he said, "We're going to throw you guys out of business anyway, because of copyright. You can't steal these programs." There's another interesting development involving Ed Craney. I don't know whether Martin relayed this story or not. Sometime in 1954, '55 period, Ed Craney, Bill Daniels, and Martin Malarkey formed some kind of a partnership, the legal organization of it, I don't know, whether it was just three guys getting together or what. But their intent was to go around and lock up the home television rights for theaters all over the Pacific Northwest. And they did.
PAGLIN: Theater television? Did you say home?
TAYLOR: Home theater is what I'm trying to say. They would make a deal with the local movie theater, that you get the film, we'll show it on our cable systems, and we'll share the profit. You make your deal with the program's distributors, and we'll put this on television on cable in the homes. I don't know the details, because I was not in it. But the interesting thing was that these three people had some kind of joint venture going, and were actively soliciting theaters all over the northwest for rights to provide movie showings on home TV, over cable.
PAGLIN: And this was in 1954, '55?
TAYLOR: Yes. In 1955 I was able to make my first trip to an NCTA convention. It was at the Park Sheraton in New York City, and I was still maneuvering a wheelchair at that time. I got on the train and my wife came with me to help me along. Well, one day I'm at the convention, and in walked Norman Penwell. We were so limited on funds, that the idea that they paid my way to the convention never occurred to me, and here's Norm, come to the convention too. Now how does this happen? Well, he had a letter from Ed Craney ‑ oh, there's another bit. I have to get the timing right here. While I was laid out, Norm and Jack and Bruce, the other three partners went to Livingston and Bozeman to build cable operations. See, I was out of circulation, so I was only hearing about this. Yes, Norm had a cable system going, (actually it belonged to Northwest Video) as well as a radio station in Bozeman. And so now, I come back to the NCTA convention ‑ well Norm turned up, and he had just received a letter from Ed Craney which ordered him to cease carrying on Bozeman Cable TV certain programs that Craney was carrying on his TV station.
PAGLIN: Non‑duplication, right?
TAYLOR: Well, this was long prior to the concept of non‑duplication. But he was to cease and desist carrying these programs. One of the early programs, that I remember that was at issue in copyright, was "The Cisco Kid", which would come in from long distance. There were exclusive contracts on it and so on. So Norm had come because he had gotten this letter from Craney, and he came specifically to talk to Martin and Bill and to see if they knew about it. Neither of them knew about it. So here they had an arrangement going, the three of them and all of a sudden Craney had indicated that he's out of it. Now he's trying to kill cable. It was a very dramatic thing, very dramatic circumstances. I'm pretty sure that was 1955.
PAGLIN: Now that's interesting, Archer, for two reasons. One, I did Bill Daniels oral history. I don't recall any mention of this. Of course, I'd reviewed Martin's transcript of his oral history. I remember no version of this. On the second hand, having been there at the Commission at the time with the whole Ed Craney stuff and, in fact, having been Commissioner Bartley's legal assistant at that very time, I was very conscious about the broadcasters and the CATV people. But, in any event, I knew all about Ed Craney and I never heard this story before. It's interesting.
TAYLOR: Well, you know, I was peripheral to it, but it made a deep impression on me because here I was in a wheelchair at that convention and my partner Norman walks in when he wasn't supposed to be there, and this was the reason for it. So the details of the home theater network that the three of them were doing and how it was set up. I have no knowledge of that.
PAGLIN: One day we should go back to both Bill and Marty and get their versions because that's very interesting. We'll have to find out about that.
TAYLOR: Well, we're close enough to the timing that the other thing that I thought of between sessions had to do with Livingston, Montana. Of course, I was still laid up, so I was not personally involved in this, but I got the story. Norm and Jack and Bruce (the other three partners) were in Livingston and this was a cable race, because Livingston was the home of Paul McAdam. Paul had a radio station there in Livingston, and eventually became a joint owner of Eastern Microwave with Bill Calsam. He was intending to become a prominent broadcaster in Montana, which he did. In fact Norm had worked for him as a radio operator at one time.
Well, they were in a cable race, because as I say, there was no franchise required in Livingston and they both had agreements with the utilities, so it was a cable race. Our group was out building and Paul McAdam had Phil Hamlin from Jerrold Northwest and I guess he'd signed the agreement, where he had Jerrold equipment and Phil Hamlin helping him. Well, they had either knocked‑off work at night, or it was at noontime. Livingston is a small town, so there weren't very many places to go and get lunch. We didn't have McDonald's and all the rest of these things in those days. So they happened to be in the same place for lunch, and Paul and Phil on one side of the room and Norm and Jack and Bruce on the other side. And finally, I guess it was Phil Hamlin that shouted across the room and said, "We're really going to run you guys out of business. You're just not going to win this race ‑ we're going to run you right out of business." Well, that's all Norm needed. He's an aggressive character. He went home that night, got out his little black book on anti-trust law, and wrote telegrams to the President of the U.S., the President of AT & T, and the Bell System, and the Senate leaders and FCC people. Everybody he could think of, he wrote letters to, in which he told the story of how they threatened him, threatened to run him out of business.
TAYLOR: Nothing came of it immediately, but then later when Jerrold was charged, and I don't remember all the details of how it came about, with anti‑trust violations, it was a big case, and Jerrold was ultimately required to divest all of its cable properties, (not its manufacturing properties), which then became H&B American and later, TelePrompTer and so on. But Norm Penwell became one of the key witnesses, the government witness on that case because of these telegrams he wrote.
PAGLIN: This was when, about when?
TAYLOR: The case, I'm not real sure, but it was either late 50's, early 60's, I'm not certain of the date but that's obvious.
PAGLIN: This was a federal case?
TAYLOR: This was a federal case, anti‑trust against Jerrold, and you can dig it out, somebody can dig it out.
PAGLIN: In other words, it was what lawyers call a vertical integration, that is to say it was a tie‑in thing. You'd have to buy the equipment with the service contract.
TAYLOR: Well, there were several aspects involved, one was this tie‑in. The other was the threatening to put you out of business. Norm testified particularly on the incident in the restaurant. We looked for any written documents. I remember searching my files, for any documents on the tie‑in of the service contract, but I don't believe that we found any. I think everything was done verbally, by telephone. But Norm was a key witness, and years later, probably was six or seven years ago at a convention in Los Angeles, Milt Shapp came and Norm came, and all three of us were together, and Milt had a hard time being friendly to Norm.
PAGLIN: So that must have been the '81 convention because I was there.
TAYLOR: Yes, that's when it was, but the atmosphere was definitely cool, and it was still over this testimony that Norm gave against him, because apparently it was key testimony.
PAGLIN: It sounds so much like what took place in the early years in the motion picture industry. There was block booking, tie‑ins, threatening kinds of things where there would be a Mom and Pop theater in Missoula, Montana, and Paramount Pictures or the exhibitor would come in and say "We would like you to be our partner." And Mom and Pop would say "What do we need a partner for, we've been here twenty years." "Oh, you don't want a partner." and they say "NO."
Pretty soon one of three things would happen, they'd get a notice from their insurance company that their fire insurance was being canceled; or a month later a steam shovel would show up across the street and a new theater was being built; or suddenly they couldn't get any product. These guys also played rough.
So, again, going back to catch up a few little things. You mentioned the banker, who earlier in the deal put up some money.
TAYLOR: Hubert Bell.
PAGLIN: Hubert Bell, and what was his role?
TAYLOR: He was cashier at the Conrad National Bank. But he was probably our principal shareholder. Certainly he had the largest block, or one of them. I think there were three blocks of stock about equal.
PAGLIN: In other words, he put up the money, really, to get you started?
TAYLOR: I guess we had about 15 shareholders that put up money.
PAGLIN: How much was involved, total contributions?
TAYLOR: I would guess it wasn't over $100,000.
PAGLIN: We've been getting these kinds of figures of what it took to start a system in those days.
TAYLOR: Plus the key thing was the contribution in aid of construction. The connection charge, the installation charge, was what really financed the venture in those early days. It wasn't until we built up the revenue stream, that we were able to live with the court throwing out the contribution in aid of construction cases.
PAGLIN: Is there anything else though, in terms of the first interview session, that you have since thought about?
TAYLOR: No, I think I got those two items in that I had made notes on to make sure I'd remember.
End of July 29, 1987
PAGLIN: Let me pick up now where we were. What was the scope of your work in terms of the CATV technical side on this first system or otherwise?
TAYLOR: Well, the four of us consulted with each other, we were all making decisions and investigations to find out how this is done, what we can use and so on. Since I was laid up I was not on the spot, I frequently had these fellows come through my house and use my library and everything we had talked about, problems we had and so on. So, technically, I can't say I made any contributions, we were just trying to survive in this business.
PAGLIN: But were you the only technical person involved?
TAYLOR: No, we were all technical. See, Norm had a degree in Engineering Physics, Jack had a degree in Electrical Engineering--I believe that was his cousin--and Bruce was a self‑trained technician, hobbyist, but with a very keen mind, a very keen technical mind, and was able to make a lot of contributions to our efforts, not to the industry in particular.
PAGLIN: That would not have come until later anyway.
TAYLOR: Yes, it began to come in here because of a number of things. Because of the development in Montana, and Senator Lee Metcalf who was a Congressman at this time. It was 1960 that he was elected into the Senate. He had taken Mike Mansfield's position in the Congress after Mike moved up to the Senate. You know Mike's home is Missoula. To this day, I think, he's still on leave as professor to the University of Montana. Mike's still on leave. So we had, therefore, some rather potent and effective political people in the Congress and because we were out in the sticks, we were out where the action was happening, where cable was developing, like in Pennsylvania. We were the first cable system in Montana in the first place.
PAGLIN: The Kalispell system.
TAYLOR: Kalispell was the first in Montana, so I got to know Strat Smith somehow or another, I'm not sure how it happened.
PAGLIN: If you tell me the year when this was going on I could probably tell you that Strat had come out into practice at the time, after he left the Commission.
TAYLOR: He went from the Commission to Welch Mott and Morgan. It was when he was with Welch Mott and Morgan, and they had assigned him to the Jerrold account. Milt had a lot already to do with Martin Malarkey with setting up the NCTA, and they needed legal counsel, so Welch Mott and Morgan assigned Strat to help out. Pretty soon, Strat became the executive secretary to this Association while he was still at Welch Mott and Morgan. And it was at that time that I met him. How it came about I'm not quite sure, but he knew of me. I was involved in broadcasting and he was involved in broadcasting. I was appearing at the FCC in various cases. So when he needed some testimony from someone out in the field, he thought of me, I guess, so I had several experiences of testifying, primarily in the Congress.
PAGLIN: I want to get into that in a little while.
TAYLOR: Then people in the industry began to know of me. There were not that many professional engineers in the business...
PAGLIN: That's why I asked about the technical part.
TAYLOR: Charlie Clements was one, but my major business was broadcasting consulting at that time. The cable system was sort of a hobby, it was a sideline.
PAGLIN: After you had built the system?
TAYLOR: Oh yeah, it was built mostly after I was laid up, so I couldn't contribute very much, except talking to the fellows when they came through the house, because I couldn't get around. When I began circulating again, and then by 1955 came to the NCTA convention in a wheelchair, I began to have more of a presence. People knew of me, and I began to get some calls from people to ask advice about cable television. So, as I say the tail began to wag the dog.
PAGLIN: Now actually how many systems were you ultimately involved in, either the building, ownership, or whichever? And where were they located?
TAYLOR: Well, they all stemmed from Kalispell. Then we extended Kalispell up to a little place called Columbia Falls. Then we looked at and finally built a very little system in Big Fork, a very small town and one in Polson, Montana. So really it was the four systems, two of which were directly connected by hard wire, that's Kalispell to Columbia Falls. Big Fork had a separate antenna, a separate microwave feed in a town of 500 people, I don't think there were more than 500 homes in the place, a little tiny place. Polson was quite far away, and we had to use microwave to get any kind of feed into it, also not a very big town. I think it had 1,000, maybe 1500 homes total. But those were the four systems that we built.
PAGLIN: And the same pattern of ownership, I mean there was Norm, and Bruce, and Jack.
TAYLOR: Basically, Big Fork we picked up from one of our employees. Bob Wallace initially started it, but he didn't have the means to keep it going, so we began to throw in some contributions‑in‑kind more than money. We still didn't have money, it was contributions‑in‑kind, to help him get this thing viable, and eventually we made some kind of a settlement with him, where we had ownership of it. Polson we built with scrounged material, second hand stuff, pretty much junk, but we built it. It was microwave, and it worked, sort of. Oh, Irving Kahn said it was the worst thing we did to him, when we sold that system to him. He hated it, the Polson system. It was too small, isolated, and hard to manage because it was too far away. It was 30, 40 miles from any other place. So he just didn't like it.
PAGLIN: This was in the mid 50's?
TAYLOR: Yeah, probably late 50's, possibly even early 60's.
PAGLIN: So now how long in this period, you stayed in Montana most of this time, you lived in Missoula.
TAYLOR: Yeah, I lived in Missoula until 1964 when I came back here with Martin, late '64.
PAGLIN: Let me go into the other thing when you said you came to Washington. So in other words, jumping ahead with Marty, Malarkey‑Taylor Associates was formed in '64?
TAYLOR: Yeah, I think there were some other things we need to stay in Montana. Yeah I joined with Malarkey, actually Malarkey‑Taylor the organization started in January, 1966. The period in between was our association with the American Broadcasting Company. I think we should get back on Montana things.
PAGLIN: Yeah, I want to get back to, for example, your involvement with some of the other local municipalities, not necessarily of systems that you built or owned, but in the whole question of the development of CATV out in this area.
TAYLOR: You know, there's several things that happened. We set up a state association and ...
End of Tape 2, Side A
TAYLOR: I guess Paul McAdam had a lot to do with starting that. Our company was a member of the association. I got elected secretary‑treasurer of the association, which I served for quite a while.
PAGLIN: And this was about when? The middle 50's?
TAYLOR: You know I can't remember when I started, it would have probably been in the 50's sometime, and I was the one man that had pushed Al Doherty to become counsel to the association and help us lobby, because Al was a very capable lobbyist. He was the guy that had made lobbying, the word "lobbying" have a decent appearance to me. Lobbying had always been a dirty word in my mind. But Al's approach to it was always, I thought, very interesting. Every year he would take a trip around the state, and you know that was a 3‑4,000 mile trip and still you hadn't covered the state. He would just drive around between the legislative sessions. He knew all the legislators, so he would go up to them, he'd catch one of them out in the field in his plow or something and he would say "Well Jim, how are things going?" 'Oh, fine, what could we do for you?' "Well, I'm just out here to say hello is all." But in the course of the conversation he'd mention milk distributors, he'd mention the beer distributors, he'd mention chiropractors, he'd mention architects, he'd mention cable television. Just in the course of idle conversation he'd mention all of these names. And frequently the guy would say 'Well, what can I do for you, Al?' "Oh, nothing, I'm not here to lobby, I'm just here to make friends." And so, come legislative time, he's now got a lot of friends that he hadn't promised a thing to, and they hadn't promised a thing to him. But they're friends. I well remember one time when there was a bill adverse to cable, or I think it was Craney that was getting the bill introduced, and Al would go around and get word as to who would be introducing this bill and he'd manage to get to this person and persuade him, "You don't really want to be sponsor to this bill. If they pass it, well that's one thing, but you don't really want to be the sponsor." And one by one, all of the sponsors got stopped and the bill was never introduced. So he couldn't say that he beat the bill, he couldn't say that he beat it on the floor. The bill was never introduced, it just never got there. Well, funny thing, as secretary treasurer, I got bills from three different lawyers for killing that bill. Never got introduced. In fact one of them was one of our shareholders who claimed he had managed to kill the bill. But I really had a tremendous respect for Al's lobbying skills. It was lobbying in the best form of the word. It wasn't going in and saying if you don't do what I want you to do, I'm not going to get money for you or something. It was always on the merits, but it was always the merits of my client. I think that's good lobbying, and that's the lobbying that should be done.
PAGLIN: The first time I met Al with you was, I guess, when Fred Ford had become president, and I was counsel to him and to the association. That's when we first established our friendship. He used to tell some wild stories.
TAYLOR: Oh, he was a wild man in a lot of ways, but excellent. He was the guy that handled my wife's case, you know, abuse of discretion against the county commissioners and went all the way to the state supreme court, and won in the supreme court. He was a good lawyer. He used to say that he knew his opposition's case better than they did, and that's the way to be a good lawyer. I must say that I haven't seen that in a lot of the lawyers that we work with around here. They are just so naive about their opposition's case. I try to tell them what the opposition's case is going to be and they discourage me. That's the way to win.
PAGLIN: Of course. Some younger lawyers today seem to forget the old adages about putting yourself in your opponent's shoes.
TAYLOR: What would I do? What kind of questions would I ask? What would be the theory of my case? How would I go? Exactly.
PAGLIN: And they don't do that. They don't do that.
TAYLOR: Anyway, Al was a very important counsel, up until he died.
PAGLIN: And he died when?
TAYLOR: Oh, must have been about 2, maybe 3 years ago.
PAGLIN: That recent?
TAYLOR: Yes, that recent.
PAGLIN: He didn't come back to Washington much after that, did he?
TAYLOR: Not often. Going back, one of the things that seems to me to be germane, because it's some really interesting history, is that Norm and I both felt that cable television was operative only where there was no television at all, no stations, no television.
PAGLIN: That was your original theory?
TAYLOR: That was our original theory: when a television station comes in, that's going to be the end of it. In Livingston, well, I don't know. We began to move into one station markets and we found out that that was a good market too. But, originally, we thought that when a station comes in that's going to kill it. So how do we protect our business in Kalispell? The way we protect it is we go after a station of our own. Instead of letting someone build a station and kill us, we'll build a station and have something to move over to. So, I prepared an application for channel 9 in Kalispell. It was the one channel that had been allocated initially, and it was a bare bones, I'll tell you . I think we were going to build a whole station for $120,000.00 or something like that. So it was really a bare‑bones thing. We figured out how we were probably going to raise the money for it, but filed the application and the most amazing thing is that the same day that we filed our application, Skinny Reardon filed an application for a station.
PAGLIN: In the same town? In Kalispell?
TAYLOR: In Kalispell. He had a radio station there, KGEZ. He had bought that from the original owners, and was a partner with Craney in Butte in both radio and TV. He had learned radio from Craney in Butte then moved out on his own with the Kalispell acquisition of the radio station, then filed an application for TV. Well, the coincidence of filing the same day was almost too great. We just figured there had to be some skullduggery there somewhere. My opinion now is that it was just remarkable coincidence, that there was nothing, I mean he didn't know we were doing it.
PAGLIN: He didn't? There was no way of his knowing?
TAYLOR: That's all I can figure now, I mean there was no way that he could have. But anyway, he filed it and he had much more money than we had, and it was a much more defensible application, because ours was all done with cheap, industrial type equipment, and you know, we had to.
PAGLIN: And this was again, when?
TAYLOR: I was up and around by then, so it would have to have been the late 50's‑‑'58, '59. So, what do we do about that. And we knew we were going to be beat. There was no way we were going to go to hearing and beat Reardon on it. Norm is an imaginative, aggressive, courageous guy, and he said, well, let's join him; let's make a deal with him and join him. So Norm--as a broadcaster, because he's already in radio over in Bozeman--went to Skinny Reardon and made a proposal that we join him. The upshot was, and I don't know all the ins and outs of it, but we came up with a 30% ownership of his application, and then dropped ours. Well, I know now what he had in mind. He figured he's going to need more money later on and he's going to try and get it from us, so he can water us down and get rid of us. Well, we wouldn't take that, and we insisted that his agreement had been that we would have 30% ownership period, not that we'd have to put more money in to retain 30% ownership. And we fought him.
I was on the board of the TV station at one time and he just told me one time, well we're just going to run you out of business and get you out of here. Well, it didn't happen that way, and we blocked him in his ability to raise more money unless we were to retain our 30%, and the only way that he could put more money in it was to put it in and still keep us at 30%. Well, that was a scurrilous approach. But we insisted, and he couldn't do much about it. So, anyway, he got the grant, and then needed to get programming. He didn't have any way to get programming. We had a microwave feed on NBC, I think. We had microwave on all three networks by this time; at least we had one, I don't even know for sure. But we made a deal with Reardon that we would supply him with a feed from our microwave, he could use it for his broadcasting station, and we had a charge for the service, but he never paid us. We didn't push, obviously. We were shareholders. So, we'd been really rather cooperative with him in one way, and in another way we stopped him from raising more money without helping us.
The station didn't make it. It was too small, I think. I told you about the NBC's letter from station relations people that told Geis and Plummer, when they wanted to build a station in Kalispell, and this letter came back from NBC, saying Kalispell isn't big enough for a station. Why don't you build a cable system?
PAGLIN: Oh, did you go through that the last time?
TAYLOR: Yeah, I had mentioned that the last time. I have to say I was not able to find the letter, but I think you and I agreed that you'd probably be able to find it in some of the FCC records, a massive search. Somebody else, Strat may have a line on where you could find it or something. But at any rate, Reardon's station was not doing well, and it got worse and worse. Finally, the sheriff came and put a padlock on it and stopped him. That was the time we could have become very wealthy if we had been smart, because all we had to do was tape record a radio program that he broadcast that night after the sheriff locked the door. He went on his radio station with the most libelous bunch of comments that one could ever imagine. We didn't know about it, but we had heard about it from other people who had heard the broadcast. It was so bad (I guess he was drunk at the time) that his own manager finally cut him off and went to some other program.
PAGLIN: What was the nature of the....
TAYLOR: Well, cable television had put him out of business, and TAYLOR: and Penwell had skinned him alive, and you know, just all kinds of stuff that we had done. So at this time you see he's very rabidly anti‑cable, hates cable and he's on Craney's side and all that.
PAGLIN: And he had been associated earlier with Craney too?
TAYLOR: Oh, he was a partner with Craney, or at least a shareholder in the Butte station. Well, I don't know how the timing happened here, but it wasn't too long after that that Norm (God, he was a gutsy guy, I wouldn't have had the guts to do it) got permission to take over the station and manage it on a management contract, and run it. Which he did. But he couldn't succeed either. He had to shut it down. So in a way, we were still owners of that thing, and Norm was actually managing it, but he couldn't make it work.
PAGLIN: That was the only station in the community though, wasn't it?
TAYLOR: Yeah, it was the only one at that time, yeah, it was some considerable time later that a translator went on. Well, we were still up there at that time, and that became a satellite station. A satellite of a Missoula station, and subsequently an independent station went into the market, but that was long after we had gotten out of there.
PAGLIN: What was the population of Kalispell at the time?
TAYLOR: About 15,000 homes. So you're talking about maybe 50,000 population. Follow up on Skinny Reardon. There is this guy in Salinas, California, John Cohan--another skinny guy--who had a TV station down in Salinas. He was angry about cable television. So angry I guess that somebody was coming into his town and he sent a wire to Skinny Reardon, who is now back in Butte. The Kalispell station was dead and I think he sold the radio station by now, and was now in Butte.
PAGLIN: Well, when you get the transcript, you can always check. It'll come to you.
TAYLOR: So Cohan sent Reardon a telegram and asked him to come down and testify to the Salinas council that cable put him out of business in Kalispell. So Reardon wired back and said, "Oh, I'll come and testify, but I really don't think you'll like my testimony, because I really believe that cable and broadcasting can live together in the same community." Reardon was now an owner of a cable system, well, a part owner of a cable system in Butte. He said he had learned that cable and broadcasting can coexist. So that was an interesting follow‑up.
TAYLOR: Yeah, there had been others that have converted.
PAGLIN: Well, that's something I believed in a long, long time ago. I think when Fred was president, I think in '65, he wanted me to go down and speak to the Georgia Association. It was the first joint session that the Georgia Institute of Technology had with the broadcasters and the cable systems in the South there. They had a big panel there, and my pitch was, look, you guys are two pieces of the same complex, the cable people know everybody down the street; the broadcasters are the show biz people, it's a natural synergism. I don't know why you guys are fighting. Ultimately you're going to get together. And that was in 1965. It took a few years.
TAYLOR: Ultimately, in a way what Craney was predicting is beginning to appear; namely at NBC and CBS and ABC, and their financial problems, and the fact that they're losing audience. You know it can't help but be that there's other programming available to TV viewers. They don't have the monopoly that they used to have. And this of course, was what Craney was complaining about. Bill Grove and Bill Putnam, and some of the others were complaining that the cable would undermine their advertising base, and in a certain sense, I guess it's right. Look! Tell him a broadcast television can undermine radio. Tremendously! Radio is nowhere near today the kind of business it was in the pre‑war years. It was a glorious business in those days, and there was great pride in it. There's no pride in it now anymore. It's just a money machine that's doing pretty well, but there's no pride in it.
PAGLIN: And there's a different medium in it. There's a mobile medium in it now, car radio.
TAYLOR: That's true. These things have to happen eventually, it's going to happen to cable. We're already looking at VCRs, they're already hurting us.
PAGLIN: And what about direct satellite reception?
TAYLOR: Yeah, I think that is a possibility, although I think there are some difficult times in that area. I'm not so sure that that's going to be as much of a change in the business as VCR.
PAGLIN: I can remember a Commission session with Commissioner Webster, who was then the only engineer commissioner. George Sterling I think had already left. We were talking then about the possibility of putting up a satellite that could broadcast programming back down, direct to the home, just programming. And he, as an engineer, said you would never find the propulsion necessary to send up a mechanism that large that would have the power required to send back TV programs. I mean it will just never exist.
TAYLOR: That was like a seminar that Irving Kahn put together of financial people in New York one time. He asked me to go up and present a paper to it, which I did. I remember one guy, Arthur D. Little, who was talking about satellites to the home, and there was only one thing that anybody remembered. The minute he said that one sentence, everybody was just ready to leave. He said "Direct to the home, not in our lifetime because you can't get enough power to transmit and receive it in the home." Well, of course, I'm still alive.
PAGLIN: Well, again, more stories. I can remember John Doerfer, before he was the FCC chairman. When he was first appointed, he had been chairman of the Public Service Commission in Wisconsin. I remember him testifying before a congressional committee when I was with Bartley, that was the early 50's, saying that if he were a banker, he wouldn't put a dime in television, because it wasn't going to last. And he's talking about 1953. And he truly believed it. Why? He was a common carrier man.
TAYLOR: Well I know I made the comment, similar comment, but it would have been around 1943 maybe, when I was working out of WMAL in D.C. The chief engineer had gotten very excited about television, and he was talking about it, and I said to him one time, "You know, I just cannot visualize myself sitting in my living room watching movies night after night after night, I just can't see that. And, therefore, I just can't see television ever making any inroads. Well, of course, my thought is still true, I don't spend night after night after night; in fact, I don't watch very much television really. But the fact is that I just said it wouldn't work.
PAGLIN: One of the subjects that I want to go into at this early phase with you, is the interaction with the other cable television pioneers, and of course you told me about your associates and your colleagues, and some of the early CATV operators. Had you had contact with other CATV operators other than those that you had mentioned?
TAYLOR: I didn't run into Charlie Clements until considerably later, although he was in the Pacific Northwest. Met a few of the people at NCTA meetings. The one that I think makes the most interesting story is Bob Magness.
PAGLIN: He was not yet with Bill Daniels?
TAYLOR: Oh, no, no, he came from Mineral Wells, Texas. And he had built a little cable system down there in Mineral Wells.
PAGLIN: Bill Daniels tells a story of how he met Bob Magness.
TAYLOR: Well, let me get my story now, Norm in our group, in our membership, and I guess when you were talking about did we build any other systems, I have to say we did build in Bozeman, and we did build in Livingston. Neither of them really survived very long, for various reasons, and I was not very closely associated, because I was laid up. But the one in Bozeman was built, and it was sold to Larry Paey. Larry was down in Wyoming somewhere, I'm not sure where, and built a system. I guess I had met Larry at one of the conventions maybe, but he bought the system that Norm primarily had built and run in Bozeman. As I remember there wasn't any profit to us as shareholders on it, it just about covered itself, or a loss, I'm not sure how it came out. But Larry Paey bought it, and within thirty days, he crashed up on a mountain side in a small airplane. And so his widow, who knew nothing at all about the business, had this property in Bozeman that she didn't know anything about, and she didn't know anything about what it was worth, and decided well, the only sensible thing is to put it up for sale, which she did. This crazy guy down from Mineral Wells came along, and bought it for 10 cents on the dollar. So that was how Bob Magness came into Montana. And I got to know him, and he was just a little operator, he got in with Paul McAdam in Livingston, and little by little, he kept building up, and went to Butte. I don't think he ever built in Billings, he wanted to, there were others, I can't remember now what all he did, but he was in the Association.
PAGLIN: The national one, or the state one?
TAYLOR: Oh, no, the state association, and I think I beat him out one year for Secretary‑Treasurer or something.
PAGLIN: That's a big deal.
TAYLOR: Yeah, it was an election, and I beat him. We'd always been good friends ever since though, never any problems. But Bob told me one time, and this is before he got into that group down in Denver, Salt Lake City group, he told me he said he had made up his mind in college that he would be a millionaire by the time he was forty. And he told me later it was 42 before he became a millionaire.
PAGLIN: That's a point that I remember from Bill Daniels' interviews.
TAYLOR: So he built microwave out of Salt Lake City, and we bought his microwave service in Kalispell about the time we sold, we hadn't had it for very long. Let's see, how did he finally get in with George Hatch in Salt Lake City. He got in with George Hatch and maybe his connection with Paul McAdam had something to do with it. I don't know how all that got put together, but he went to Salt Lake City and he was going to build a system in Salt Lake City with George Hatch. There was another well known broadcaster down there whose name escapes me at the moment, who was involved in this thing, and that eventually blossomed into Community Television Inc. in Montana. And then all of his different Community Television Inc. properties became merged in telecommunications which now, of course, is TCI. Bob was the kingpin of TCI for many years. In fact, after I had committed to come back here with Martin, and I guess I'd even started with him on the ABC venture, Bob offered me to come down with him to Salt Lake City. I thought about it, but I'd already made one big change coming to Washington, and I'd committed myself to Martin, and am I ever glad I didn't do it. It was somewhat attractive though, a big operation, and in some ways operations are more exciting than, at least there's more engineering involved than consulting. Consulting is a lot of things, hand-holding, and a lot of other things. But I didn't take him up on it, and we had always remained good friends. In fact at one time, he and Betsy had named me as their executor in their will.
PAGLIN: Really, you were that close?
TAYLOR: Didn't last very long, because they changed.
PAGLIN: No, I mean you were that close with them at the time?
TAYLOR: Shortly after they left Montana was when they named me executor. I was pretty good friends with them, both Bob and Betsy.
PAGLIN: And Betsy of course, died last year, two years ago?
TAYLOR: Betsy died two years ago now.
PAGLIN: That was a shame, she was very active in the business.
TAYLOR: Yes, she was, awfully nice person. Bob was crafty, and he was the guy who'd chew cigars, did you ever see him?
PAGLIN: Yeah, but I thought he smoked them too.
TAYLOR: Never smoked them, never lit them up. He'd sit there and he'd chew on them. After a while you'd have an ashtray and there are 4 or 5 bent up, disheveled cigars in the ashtray, but never one lighted. He just chewed on them. I don't know whether it belongs here at this point of time here or not, but you know John Malone is now President of TCI, and Bob is Chairman of the Board, but not actively pursuing it. I first met John Malone, must have been in the 70's, after Bob, oh, who was the president of Jerrold who drowned.
PAGLIN: Oh, Bob Beisswenger.
TAYLOR: Bob Beisswenger. I don't remember if that was after he drowned or before. But at any rate, I was working for Ed Sullivan's property up in Glenns Falls, New York. Jack McGeehan was manager of all that. We got into some kind of a problem with Jerrold equipment and Jack asked me to go down and meet with Jerrold and Jack and some of their people. So we did. We met with several people from Jerrold. Lee Zemnick, I think it was, came into the meeting very briefly, and said "I've got a young man that I'd like to show him around. Would you mind if he sits in on the meeting?" So here's this young kid in shirt‑sleeves, really quite thin, bright looking young man, who was introduced as John Malone. I guess they introduced him as Dr. Malone.
PAGLIN: Does he have a Ph.D. or something?
TAYLOR: I think so, yeah.
PAGLIN: He was working with Jerrold at the time?
TAYLOR: He was working with Jerrold at the time, but here he was, just a young kid, who'd been brought in to kind of learn the business. Two or three weeks later, I see he's appointed President of Jerrold. We almost died. So I dealt with John Malone on several occasions as president. Then Bob Magness, I guess, asked him to join him at TCI.
PAGLIN: Boy, that's interesting, I didn't get to know those ins and outs.
TAYLOR: He's been president for oh, maybe three years or something like that. Very competent guy, obviously, has to be.
PAGLIN: I don't know what his background is. By the way, going back to Bob Magness, I think Bob is on the Penn State list for an oral history. Yeah, I'm sure he is.
TAYLOR: Well, he's got to be in on it.
PAGLIN: I don't know who's doing it over there, but we coordinate the lists you know. Ben Conroy, of course, is the chairman, and we coordinate the lists of who's going to take what. Well, going back now to the formation about the nationals. Now, about the Montana association, Archer, when did you first get into the National Association, that is to say, your activity with what has become the NCTA?
TAYLOR: Oh, I imagine that it was in the late 50's, '57, '58, in that period.
PAGLIN: What was the scope of your activities?
TAYLOR: A lot of this is muddled together. Primarily, it was testimony in Congress before Congressional Committees, having to do with how cable operates, and how we operated in Montana, really having to do with grass‑roots Montana.
PAGLIN: I'm going to get into that, I mean a little more on that Congressional hearing, you know that.
TAYLOR: As I appeared in those hearings, of course, I began to be known to other people in the industry; my profile got a little bit higher. And then I began to get called to do consulting jobs for operators. Primarily they were feasibility studies of new situations. I don't really recall very often getting called on strictly technical matters.
PAGLIN: You did serve on some of the committees, of course?
TAYLOR: Oh yeah, my first committee assignment was in 1960 I think when I was made chairman of the Standards Committee. I think that's about the time I became on the Standards Committee. Oh, it was earlier, it was before Fred Stevenson became chairman. The Standards Committee had been not at all professional, and really was just floundering. They didn't understand Standards Committee work, or what it meant, or how to go at it. I must admit that I was pretty well floored at the prospect. A first project was a Glossary of Terms. I found that an awful lot like trying to pick up a ball of mercury with two fingers. You just couldn't get a good grip on it; you didn't know where to start; you didn't know how to go at it, it was a very frustrating thing. We then, several years later, got moving in a much more professional, technical way. The first real set of standards were developed, and Ken Simons obviously had the biggest contribution to that whole thing. It was Ken who was probably the most outstanding manufacturing engineer. All of the really technical skill was in the manufacturers at that time. And don't think I wrong either myself or Charlie Clements when I say that. Charlie and I were both professional engineers, and probably about the only two of them. .
PAGLIN: Who else was on the committee of that nature?
TAYLOR: Well, I can't remember now. But it tended to be manufacturing people, technicians from cable systems. Oh, I remember Tom Smith was on the committee from Scientific‑Atlanta. Scientific‑Atlanta got into it by acquiring Spencer Kennedy Laboratories. No, that's not right, that's not the way it happened either, because Tom Smith, Alex Best, and Blair Westin, three engineers at Scientific‑Atlanta, and Tom Smith was really the innovative, imaginative one. Alex was pretty young at the time, and Tom had heard about the development at Iowa University School of Engineering of a log periodic antenna configuration.
PAGLIN: Say that again, log. . .?
TAYLOR: Log periodic, it's a special type of antenna that really is the best that we're using.
PAGLIN: How's that spelled?
TAYLOR: Log periodic, logarithmic periodic is what it is. Scientific‑Atlantic was deep into antenna, primarily in communications, and they were beginning to use the log periodic for government communications, general communications. Tom Smith had some experience with cable, I don't know what it was, but he figured that this would be a good antenna for cable, and they liked it. So Scientific Atlanta built a log periodic antenna for the cable industry. It turned out to be a very successful antenna. They made some mechanical mistakes. The first one broke in a few places, but basically, a very sound design, one which has been, to this day, the best there is. Well, Tom and Alex thought the next thing was to build a pre‑amplifier to go with the antenna, and the next thing was a headend piece, and this is where I think Alex Best got started. Tom moved on into other parts of the company, and Alex as you know became Principal Engineer. He was V.P. of engineering or something like that, but he's now V.P. of Cox. He left Scientific‑Atlanta.
PAGLIN: Was Sid the head, not the head, let's see, he participated in the panel of our conference that the Golden Jubilee Commission held on government regulations and technology. Sid, what's his last name, Scientific‑Atlanta now...
TAYLOR: Oh, Topol.
PAGLIN: Topol, right. Was he there at the time?
TAYLOR: No. Sid Topol was much later as far, as I know. He may have been with the company but my knowledge of Sid Topol is much, much later.
PAGLIN: He's a very competent guy too. He's now a leading figure in industry.
TAYLOR: Yeah, no question.
PAGLIN: So actually this Standards Committee of NCTA was doing virtually hands-on work in terms of developing equipment for the industry.
TAYLOR: Well, yeah, by virtue of the manufacturers. Ken Simons is doing the hands-on work. Then he would come to the Standards Committee with his idea of how we should measure, for example, noise or the cross modulation, which were the two key performance numbers. So we wrestled with his method of measuring and tried to make it so that it could be written into a standard. I finally did the drafting on the standard and we got it approved in committee and then I took it because I was also at that time a member of the board of directors. I took it to the board of directors for approval.
PAGLIN: This is of NCTA?
TAYLOR: This is of NCTA. So we got several standards, we got a standard on symbols, we got a standard on cross‑mod, on noise...
TAYLOR: Cross‑modulation. We got a standard on noise, oh, what was the other one, I made several.
PAGLIN: In broadcasting I know, would this stuff have been submitted to the IEEE or the National Standards Committee?
TAYLOR: This didn't happen until Delmer Ports came.
PAGLIN: Till who?
TAYLOR: Delmer Ports. Delmer Ports became, well that's another story but that's later on. Delmer was very active in IEEE. In fact the general manager was a close personal friend of his, and had been a partner with him at one time. But at any rate, Delmer knew the ropes at the IEEE very well, and he got some standards adopted by the IEEE. There has been nobody at the Association who has been sufficiently knowledgeable to keep up that IEEE connection. In fact we've all been fairly inept at that area. Howard Head and I were primarily responsible for organizing the Broadcasting, Cable and Consumer Electronics Society of the IEEE.
PAGLIN: Was that part of EIA?
TAYLOR: Of IEEE. We merged the broadcast group with the receiver group. The receiver group by this time had changed their name to consumer electronics to include a lot of things that weren't receivers. We merged it and we merged cable in what seemed to be a natural marriage. It was an excellent idea, and very logical, but we just didn't have the stamina to keep it alive. And meanwhile, unfortunately, well, fortunately, the Society of Cable Television Engineers got started.
End of Tape 2, Side B
PAGLIN: This was the Society of Cable Television Engineers?
TAYLOR: Yes, subsequent to broadcasters and receivers and cable in the IEEE. Consequently there was a double drain on loyalties and interests and the cable industry was much more interested in the smaller group that consisted of technicians, rather than the professional group which had very high level theoreticians. I guess the cable people felt they would be looked down on and get lost, it wouldn't amount to anything. To some extent there's some truth to it, but my goal in all of this was to upgrade the cable industry because we did have a fairly crude bunch of technicians in the business running it--running the technology--and I did want to see it upgraded to where we had more professionals, more real professional activity. This has been coming about, because at that time, the professional quality of work was almost exclusively with the manufacturers. A few people like myself and Charlie Clements and maybe two or three others then began to move out into industry. But it's been a slow process and I had hoped that the IEEE would help to expedite that process, but we couldn't keep it alive. We had an excellent opportunity. We had Transactions of CATV which was delivered to 400 libraries over the world automatically. It was published by the BCCE society, which had three publications, one was the broadcast technology part, one was on consumer electronics, and one was on CATV. But having the world wide archival prestige of getting those papers in over 400 libraries over the country, that to me was just the biggest attraction. We were becoming somebody.
PAGLIN: With the IEEE.
TAYLOR: With the IEEE. We knew we couldn't keep the papers going.
PAGLIN: You use the word transaction. Is that another technical word for something that I would say papers, or....
TAYLOR: Well, the publications of professional societies are often called transactions.
PAGLIN: The proceedings you mean?
TAYLOR: The IEEE has a proceeding and they have a number of different transactions on special topics like broadcasting, and receivers, and so on.
PAGLIN: All of the engineers have got their own mystique terms.
TAYLOR: Yeah. Their organizational terms, and you'll find these in organizations all kinds of them.
PAGLIN: Would it be possible for you to dig up and make copies of some of the early articles, technical articles that you may have authored, either alone or with others, in the early days, the 60's or whatever? Some of those are listed in that biographical sketch that you sent me originally.
TAYLOR: Yeah, I've had to dig these up for other purposes, and so I think I've got them reasonably well assembled.
PAGLIN: That would be very helpful to them at the Cable Museum. Any other artifacts of that kind or any documentary stuff would be very helpful it seems to me for future researchers. The next topic is federal regulatory response to the cable industry.
PAGLIN: And your role in the cable industry's experience with the development of FCC regulatory policy, Congressional hearings, I mention. Ed Craney's opposition and that of broadcasting, and the early CATV litigation, and generally the direction of the industry's development from your point of view, and of course you have referred to it from time to time. In terms of the technical aspects at the time that the federal government was beginning to get involved in, which is, of course, the early/middle 50's and onward. So, we may not be able to finish that today but tell me a little more about some of the Congressional hearings that you attended.
TAYLOR: Well, I think the highlight of the whole congressional thing was the 2653‑‑Senate Bill 2653‑‑and I'm unclear on dates, but it strikes me that it was about 1960 or '61. The history backup is that the Carter Mountain case had successfully released microwave of a sort, let's say somewhat released to us, and so we were able to get microwave. Broadcasters were hollering for the government to regulate us very tightly. We were contending that we didn't need to be regulated as I understand it, but the pressure was on from the Ed Craneys and the Bill Groves and Marshall Pengras and the Bill Putnams and oh, all that bunch, Johnny Cohan at that time in California.
Strat Smith, who was our principal lobbyist and counsel in this whole thing, conceived the idea that we go for a licensing law that would give us standing, that would give us some prestige, and define the limits of regulation. And so he worked on this, and he lobbied it. I'll never forget at that time, my good friend, Senator Lee Metcalf, I guess I had told you earlier that he had been an associate justice of the Montana Supreme Court and called me to help him with a broadcasting problem that he had, and I had done it, and we remained close friends up to the time he died. In fact, we're still close friends with his wife Donna. But Lee said you need to be regulated to give you the prestige, to give you the standing in the communications community, and so I went along with the idea. I thought it was sound thinking. And Strat had lobbied this thing, had got cable operators to come in. Always you build up a grass root campaign, and you get the people who can do this sort of thing and have some kind of a presentable appearance. They really don't like the leather jacketed guys coming in, they wanted somebody a little bit more professional, so that was how I got called, because I was professional, and I understood the legislative process, and had some contacts with a Senator that were fairly meaningful, so...
PAGLIN: He was not on the Commerce Committee though, was he?
TAYLOR: No, No, Government Operations Committee. But because cable television was so big in Montana, and the whole issue of what we now call translators, oh, they used to call them by all kinds of names in those days, got going really in Montana and the Pacific Northwest.
PAGLIN: Sure, because I remember the Community Case.
TAYLOR: Was that the Quincy‑Washington case?
PAGLIN: No, it was actually called Community Television.
TAYLOR: Where was it?
PAGLIN: It was also out west. This was the one where the court, if you remember, can I digress and I think it will refresh your recollection. What had happened was that these translators had sprung up without licenses, and the FCC field guys had discovered these things.
TAYLOR: This is the one that said that you don't have to have a license to run a baby carriage down the highway because it doesn't hurt anybody? That was Quincy‑Washington. That was probably the name of it.
PAGLIN: I was Chief of Litigation at FCC at the time and I remember the case. So the Commission went after them in terms of operating a "telecommunications" or "communications facility" without a license. And the court said in effect, "Yeah, that's right, I'm sorry fellas, you need a license."
But then, they did something that courts normally do not do. They turned around and said to the Commission (in judicial words) "get off your butt and get some regulations to authorize these things because the people need them." That was the C.J. Community Services case and Stratford was involved in that.
TAYLOR: I've got a couple of interesting stories that go along with that whole thing. Maybe I should finish the 2653, since I started it. So Strat had engineered a great grass‑roots lobbying campaign, and had people coming from all over, and I was in on that.
We all went back home, and all of a sudden one day we get a telegram from Milt Shapp, and it said "Urgent: that you come back and testify before the Senate Commerce Committee which was headed by ...Rhode Island's Senator Pastore... and testify on this issue of 2653. Urgent that you come." Urgent meaning meet at the Mayflower Hotel to talk about it, and it was then when I came back to that meeting that I learned that Milt and Henry Griffing had decided to turn the whole thing around and ask the Senate to oppose 2653, in spite of Strat Smith. Their theory was, look, we don't want to be regulated. We don't want to be regulated. Now Henry Griffing was oh, what did they call his company, Theaterview, Fullview, Vuemore, or something. Anyway, he had a chain of theaters in Oklahoma, primarily, and it was the one at Bartlesville that he worked with Milt Shapp on an actual home theater pay TV, first one of those in Bartlesville, and this was Henry Griffing's Vuemore Theatres. That's it. And the guy who's got the famous award in cable. They give this award year after year. Marty got it one year, and they've changed the name of it now. Larry Boggs, the Larry Bogg's Award. Larry Boggs was Henry Griffing's right--hand man, I think, in Oklahoma. Well, Henry I think, was the one that persuaded Milt and said "Look, you don't want regulation, you like it the way it's been, you don't want regulation, you can do anything you want to do, until they stop you." So he and Milt turned the industry around, and they set up a grass‑roots campaign to go into the halls of Congress and petition or lobby against this bill that they had been lobbying for.
Well, Senator Fulbright, who had the cable system that Fred Stevenson, no, he had a little radio station and maybe a TV station, although I really don't think so, in Fayetteville, Arkansas, and Fred Stevenson was his manager, general manager. They built a cable system down there so Fulbright was a primary owner, probably a major stockholder in the cable system, and he had carried the ball for 2653, because he thought it was a logical and rational approach and Strat Smith liked it, Fred Stevenson liked it, and it was the way to go. Well now they come around and they want him to oppose the bill that he's been supporting. He told Fred and some other people, "Look, I'll always support you in the Senate, I'll support your positions in the Senate, but don't ever come and ask me to front for you again." Senator Pastore was absolutely livid with rage because he said "I had no axe to grind at all, I have no cable system in my constituencies, I have no axe to grind at all." Here I just thought it was right that broadcasters shouldn't be able to say that a cable system couldn't carry programs, this rebroadcast position that Broadcasting, Sol Taishoff and Rosel Hyde pushed so hard. He just thought that was crazy, you're putting the life blood of one industry in the hands of its major competitor. And you just couldn't do that.
PAGLIN: Who, Pastore?
TAYLOR: Pastore, yeah, and he said "I supported you on this, I supported you on this bill and now you're coming along and asking me to turn it around." Boy he was just double‑crossed, he was just livid with rage.
Well, you could see, Congressmen do not like to get out on a limb and have it cut off on them. So, the vote came up, and our two senators were Metcalf and Murray, Jim Murray. It was either Metcalf or Mansfield. Well it was the Senate, so it had to be Mansfield, because Metcalf took Murray's place, that's what happened. Murray had promised our people that he would vote for 2653, we had his word on it, and of course old Jim Murray was senile by this time. Charlie Murray, who was then about 65 years old, Jim Murray's son, was running the office and everybody knew it. I sat up in the gallery with Strat Smith sitting right along beside me, and watched Charlie lead old Jim Murray in, led him by the hand, led him over to his desk, sat him down, and when the vote came, he told him how to vote, to vote against 2653. Meanwhile, Senator Kerr from Oklahoma, oh, he was a showman, but he got up and he made...
PAGLIN: This is Bob Kerr?
TAYLOR: Yeah, this is Robert Kerr, Senator Kerr, and, of course, he was owned lock, stock, and barrel by interests in Oklahoma, mostly oil but Griffing was a powerful enough one so that when Griffing said vote against it, he voted against it. So he got up and made this impassioned speech about how the lawyers are just walking all over these poor little people that are running cable television systems, Strat Smith, is the guy, he's just terrible, he's just taking these people down the primrose path, and here he is sitting right alongside me. He can't say a word.
PAGLIN: Did he point to you and Strat in the gallery?
TAYLOR: Oh yeah, yeah, oh it was vicious. And he cried, you know, Kerr could weep at the drop of a hat, and it was important to weep. Then Senator Monroney, who was the other Oklahoma senator, got up and made speeches about these people who are being led down the primrose path by their lawyers. Well, voting then came, and it was down to where there was a tie vote. One senator was missing, this was Senator Yarborough from Texas. They tried everything to get Senator Yarborough in there, they couldn't find him. Nobody knew where he was, they sent the Army after him, they sent airplanes down to pick him up, but they couldn't find him, they didn't know where he was. Nobody knew where he was, he was just missing. So finally they gaveled the thing down as a tie vote which means that it goes back to committee. Well, Yarborough, of course, was probably well controlled by Johnson, and Tubby Flynn was pretty close to Johnson, and I'm sure there were some influences down there, and Yarborough thought it was best to just disappear.
PAGLIN: This is LBJ that you're talking about?
TAYLOR: Yeah, Yeah, he was a senator at the time. I think he may have been majority leader.
PAGLIN: Could have been, could have been, it was the 60's, '61.
TAYLOR: So the bill was sent back to committee, and therefore it failed, which is what Griffing and Shapp wanted. I happened to be flying up to New England at the time. I guess I was going up to visit my family or something in the Boston area, and was on the airplane, and a couple of seats behind me was the delegation from New England, including Al Ricci, and all of the other people, I forget who they were. But they were just so exhilarated, "We won, we won, we won!" and I'm sitting there thinking "My God, we got crucified." So I just felt that was kind of wild.
PAGLIN: Now LBJ was not yet, now let's see, if that was the early sixties, LBJ was not yet in Austin with George Morrell yet.
TAYLOR: No, not yet, not yet.
PAGLIN: He was in broadcasting though.
TAYLOR: Oh yeah, oh yeah.
PAGLIN: Lady Bird was you know, right in there, they had a station down there in Austin.
TAYLOR: And they saw to it that there weren't any other stations down there.
PAGLIN: Right, oh yeah, oh yeah. Too bad George isn't around to tell us some of those stories about....
TAYLOR: Oh yeah, he could tell some marvelous stories.
PAGLIN: I remember some of them, but I don't know if I could ever tell them.
TAYLOR: Fritz Hollings, Senator from South Carolina, might be able to tell you some of them. He and George were very close friends.
PAGLIN: Was he?
TAYLOR: Oh yeah.
PAGLIN: George Morrell? Did he come from South Carolina?
TAYLOR: I don't know.
PAGLIN: I never knew that. I was his lawyer, you know. I was his lawyer.
TAYLOR: Whose, Morrell's?
PAGLIN: Sure. I represented Midwest Video. I brought the Midwest Video case that ultimately went up to Supreme Court, that was, I was his lawyer and I brought it, the first case, and then the appeal in the Eighth Circuit, when Ben Conroy was Chairman of NCTA. Then when I got called back to head up the first executive directorship for the FCC, the chairman, Bill Henry wanted me to come back, and hell, I didn't want to leave private practice. He said, "Well, you gotta do it, LBJ's commissionership is waiting for you and all that." I then turned Midwest Video and George Morrell over to Harry Plotkin in 1966. That's how Plotkin got into cable, sure. Black Hills was a case I also handled for George, and the Midwest Video, and argued that. It was the first appeal against the FCC's Second Report and Order on cable.
TAYLOR: George really did a job of litigation for the industry; the industry evidently couldn't handle it.
PAGLIN: Midwest Video II, about the cable origination, the program origination that was, but I never heard of this connection. You know, he had the Firestones, and the Rockefellers, and all of those on his board, and Senator McClellan.
TAYLOR: There was a governor, also from South Carolina who filled temporarily, a senate seat, somebody must have died. His name was Luther Hodge and Morrell actually considered him his attorney in some matters.
PAGLIN: In South Carolina?
TAYLOR: I can't think of his name now.
PAGLIN: You're not talking about Arkansas are you?
TAYLOR: No, No, I don't know how it got to this South Carolina thing. I worked for George as a consultant for a period. Let's see, it was after Johnson died, and obviously before George died. So if you know those two dates you can figure out...
PAGLIN: Johnson died in '69,'70,'71, I've forgotten now. Well he left office in '68, right, he went down to the ranch...
TAYLOR: He went down to the ranch and lived there for three or four years maybe.
PAGLIN: So you worked with George?
TAYLOR: Yeah. See, he and the Johnson interests jointly owned the cable system in Austin. Well after Johnson was gone, the Johnson power in Austin was dissipated, and so they got a city council down there that was just plain anti‑Johnson. Anything that Johnson had anything to do with they just went against. So George went after a franchise renewal early, trying to anticipate, and he hired me to help him with the renewal, and he just got clobbered. Well, he helped to clobber himself.
PAGLIN: That was George's way.
TAYLOR: He's a little bit like that. He talked about this fellow who was into the Senate for a short period. I'm still pretty sure he was from South Carolina. But he would tell me to call Hollings, and I think one time Hollings called me. Hollings wouldn't have known me from a hole in the ground but it wasn't any close connection at all, but Hollings .... George admired him tremendously and consulted with him frequently.
PAGLIN: So that was after my time then I guess, because I left in '66. I mean I was George's lawyer until 1966. Then I went back to the Commission.
TAYLOR: I did talk to this guy who was temporarily in the Senate on several occasions.
PAGLIN: Harry Plotkin would probably know about that.
TAYLOR: Yeah, I could probably search for it too, because once somebody mentions the name I'll remember it. I never did know how George got connected with South Carolina.
PAGLIN: You know, his system is there, but it could have been the network, you know, Firestones, then the Rockefellers.
TAYLOR: George lived basically in Arkansas.
PAGLIN: Yeah, headquarters of Midwest Video were Little Rock.
TAYLOR: Well, I think George himself probably came from New York, didn't he?
PAGLIN: Well, he actually came from Europe. I don't know where he lived before he moved to Little Rock, I don't know, because when I represented him, he was already in Little Rock.
TAYLOR: He had a guy working for him in Austin named Frank Wawak, who was really his real right‑hand man. I remember they had a Lincoln Continental and a driver, and Frank was his driver and George wouldn't fly anywhere, and Frank would drive him up.
PAGLIN: Yeah, that's right, I remember that, I think he got Frank from Rapid City. I also represented the Rapid City Cable system. Remember Mrs. Duhamel? That's when I first got called. I had been General Counsel when I had left the Commission and gone into practice, and George had gotten into trouble with the Commission in an ex parte thing.
TAYLOR: Yeah, I think I remember him telling me that. Well, when I went down to Austin I wanted to find out something about how the system operates, you know. I sat with Frank for quite a while, and got a good picture on the technology and so on, and wanted to talk to the manager. I wanted to find out what goes on, a number of things, what kind of public relations do you have, and so on and so forth. Frank introduced me to the manager, and my impression of him was that he couldn't decide whether to buy 15 paper clips or 3. He just had no competence whatsoever, no knowledge of what was going on, and I made the comment to George one time, "How come this guy..." Well, he said...
PAGLIN: I know what's coming.
TAYLOR: You know the story?
PAGLIN: Yes, of course, but tell it anyway, go ahead, tell it, tell it.
TAYLOR: Well, of course, I'm remembering how George told it. He said that one time President Johnson wanted to appoint a general, and advance him over another guy, and in order to advance him he had to get rid of this other guy. So he ordered George to hire him as his manager. I don't think he was competent.
PAGLIN: Later on, or about that time didn't LBJ have his son‑in‑law come in, the 60's.
TAYLOR: Yeah, that's Nugent, Pat Nugent, but it was very brief, and I don't think he cut much ice, the divorce had just taken place I think when I was down there, so he was not active at the time when I was there, but my impression was that he didn't shape up much, he was there, but.
PAGLIN: Is this a point where we might be able to stop and go on with the early litigation and direction of the industry's development at a later time? We've had a couple of hours you know, I don't want to...
TAYLOR: Well, I did the 2653, I think that was probably one of the biggest regulatory things. The other one that was big, from my point of view was, what's now called translators, because we got very deeply involved in that. They scared the pants off of us for one thing, we thought it was a terrible threat. You go up there, then in the Pacific Northwest they were calling them reflectors, and that was a total misnomer, sometimes they called them repeaters, but they preferred the term reflector. The story I wanted to tell you was about a translator/reflector, and it may have been this one you spoke of, the Quincy one. It was somewhere in Washington State and the RI (Radio Inspector) was called in because of an illegal transmitter. So he climbed the mountain, and got up there and found that it was indeed an illegal transmitter, so he ordered it shut down. So it was shut down. They flipped the switch and he left. No sooner did he get down to the bottom of the hill when he found that it was transmitting again. So he went back up the hill, and this time he carried a padlock with him. When he got up there he put a padlock on it so they couldn't turn it back on again. Started down the hill and he got a little ways away and KAAPOWWWW! "Boy!" he said, "This is beyond me, I'm not going back up there now!" He called Washington...
PAGLIN: What, they shot the padlock off?
TAYLOR: Shot the padlock off and put it back on the air. So the RI said, this was Dietz, I think was his name, Bob Dietz, sounds like it.
PAGLIN: Well, there was a field engineer by that name.
TAYLOR: Yeah, he was a field engineer at that time. Yeah, that was a funny story. Then we heard another one about a translator up in Plains, Montana, I think, where somebody got mad at it, and took a jeep and just ran back and forth over the equipment.
PAGLIN: We used to tell a story about the early days of television, and you'd get a farmer out in Iowa somewhere, who'd put up a 200 foot stick to get some snowy kind of picture. It all came out in the Paramount case, because this was THE box, you know, they wanted to watch it. Well the Court, and I don't remember if Strat Smith was counsel or not, but anyway, the Court was convinced that this was a need, a public need, and these people were entitled to get some service. The fact that the government had not recognized it yet, and the fact that the government had not promulgated regulations that would permit this technology, well, the hell with that noise. Of course, we're not going to put these guys in jail, but we have to stop it, but like I said, the Court in effect said "Okay, now you guys promulgate some regulations, so that this service can be made available." Wasn't that what you found?
TAYLOR: Yeah, I suspect that's part of why Strat Smith was pushing for 2653, because it would establish a means by which this service could be made available, and actually, that was the NBC letter, you know, that told these guys up there that there's not enough people there to support a television station. Why don't you build a cable system so that those people could get television. So, you know, I think it was a recognized point of view, and I think the 2653 was a recognition of that, but it didn't happen.
PAGLIN: But, as they say about the "invention of cable", what is the old cliché 'necessity is the mother of invention'. The people want something like that, they're going to find a way to do it, technically or otherwise.
TAYLOR: The thing that made me sore in those days, even up to modern times, we could not get the Commission to be concerned about the fact that a translator, or a reflector, or whatever they want to call it, was interfering with the reception of a cable television system. We always made the point, well this little repeater, or reflector, is providing service to maybe 100 people, but the cable system is providing service to 10,000. We never could get the Commission to recognize that case of interference, and I'm sure it's because cable had resisted being regulated for so long, that had we had a license bill, then we would have been eligible for protection.
PAGLIN: What would have been the nature, just to briefly describe, you know, non‑technically, the nature of the interference. Was it leakage or what was it, how was it causing interference?
TAYLOR: Well, I put up an antenna on a mountaintop to receive say, Channel 4 with my headend. It's in an area where you can't get reception very easily, and so you go up on a mountaintop and you receive it. Well, somebody else comes up here with a repeater, which is not a translator, into the same frequency that goes out, and they pick up Channel 4, same place we are, they go over the brow of the hill and then they transmit on Channel 4. Well, we're picking up a very weak signal up there and this thing that's transmitting, maybe it's only a watt or two, but it's only 3 or 400 feet away, and consequently, the signal is so much stronger that it just wipes us out on Channel 4. We never could get that kind of interference protection.
PAGLIN: Well, why do you think they were so hard on you?
TAYLOR: Well, because we were not regulated. Well, two things, one is a legitimate reason, that we were not a regulated industry, we were not eligible for FCC protection in the legal sense of the word. We were not licensed operators. We were a receiving service, and they hadn't really gotten interested in the receiving business very much at that time.
The other thing is that I think the Commission just felt that we were bad people. I don't know about the Commission, but the staff, the people at the staff level, they thought we were cheap and dirty people, and we were not professional. We weren't doing things right, we just weren't to be trusted. Well, they didn't give us any respect at all. Now that's one that you can't bank, or prove, or anything like that. It's just been my feeling that there's been a definite antagonism on the part of the Commission staff to cable; probably stemming from Craney, and Bill Putnam, and all of these early opponents.
PAGLIN: The opinion has been held in certain quarters that at that time the feeling at the Commission--due to the pressure of the broadcasters, an established industry--was that cable itself was a threat to broadcasting in the sense that there was a possibility of a diminution of revenues, duplication of programming, and that the broadcasters saw that it was a definite threat, particularly some of the UHF stations, that were struggling to get along, number one. Number two, there was a feeling, you know as you say, you said "bad guys". Was it not your recollection, a feeling that "Well, this whole idea of taking a broadcast signal out of the air, and selling it was kind of to use that dirty word, a little piracy." Remember that word.
TAYLOR: I'll give you a little story on that one too. Joe Sample was a broadcaster in Billings, Montana, he had a TV station there. As Secretary‑Treasurer of the State Association, I got a letter from him one time, I can't remember the purpose of the letter, and all I can remember is the first line. He said "I can't really refer to you people as thieves, because thieves work stealthily at night, and you guys work right out in the open."
PAGLIN: What was his name?
PAGLIN: Sample, well, that's funny. He was a broadcaster?
TAYLOR: He was a broadcaster, although he was another one of the broadcasters, who eventually went into cable. But he considered it thievery.
PAGLIN: You know the old French phrase, or was it an English phrase, "what goes around comes around".
TAYLOR: I don't remember your question to me, how was it framed, did I ever consider it piracy?
PAGLIN: Well it was framed in terms of, you heard that, and what was your reaction?
TAYLOR: I think that what was the most startling thing was Joe Sample's letter. But my first realization that there was a genuine issue on the other side was the "Cisco Kid" film thing in Reno. The Reno station had an exclusive contract on carrying "The Cisco Kid". Then the cable system came in, and they were picking up the Sacramento station, which was a perfectly normal and logical thing for them to do, but they also had "The Cisco Kid" on there. Suddenly, it dawned on me that there is an issue here. There's a real issue. In circumstances that are a little different, like ours in Kalispell where there was no other television receivable, it was not an issue, shouldn't have been an issue. So some of my testimony in Congress on these things is related to the fact that you're swatting at flies with a sledgehammer; you're dealing out an awful lot of things that aren't real problems, real issues, in order to get at the one that is a real issue. So many of the regulatory concepts were generalized things that didn't take into account a whole host of specific inequities that they were creating by their regulatory approach.
PAGLIN: Which later led to all kinds of requests for waivers that became so numerous that they finally had to say well, you know, go ahead and do it. The point I was making was, as is frequently the case, (just to get your reaction) decades afterwards or a decade afterward, that the technology advances, you get a similar kind of competitive situation right? For example, now with VCRs and satellites and so on, you get the motion picture industry on one side, with the must carry issue for example. Is it not true that in theory it's not different.
TAYLOR: There are a lot of similarities. The motion picture must carry issue I don't follow closely enough to really have a view on that. But the back yard satellite dishes, that's a classic example. Because here are people that want to get television. I've got a friend that lives down on the Great Wicomico. He's retired, and he's a very good friend of mine. He's out where there's no television. I've tried to give him some hints on what to do to get some television, but no matter what you do in that location it's going to be poor. So finally, he got himself a satellite dish. Gosh, he gets better television than I get. And many channels, all kinds of stuff, including the feeds out of CBS, which he always likes to watch, and PBS he gets those feeds. So from his point of view there's no question, but that it's a logical and appropriate thing to do, as long as those signals are there. The other side of the coin is, though, is how can these programs survive if their means of collection is denied them. So, there had to be a means of doing it. Either they had to go advertising supported, in which case you didn't try to collect from the users, or you had to have a means of collecting from the users. Well, the law says that's it's against the law to intercept this signal unless it's authorized. But there's no way to enforce that, obviously. So properly, I think the FCC said, or maybe the courts ruled, and now, of course, the Cable Act says that these things have to be protected in order to prevent somebody from receiving them.
PAGLIN: And do it technically in the form of scrambling.
TAYLOR: In scrambling, correct. The issue on scrambling now is a little bit more complex. What do you charge for that service? That gets into some rather difficult arguments, both back and forth. You can see both sides of the argument, how it's done.
But there is a problem I see when the cable operator in the community controls the sale of devices and the sale of the scrambled service. That looks to me like a problem. It's a little bit less of a problem, but still I can understand people seeing it as a problem when an HBO, who provides a service, and whose customers mainly are cable operators, then has control over what you pay for the service when you're a little guy. A lot of these problems have no answers, you know.
PAGLIN: Except that is it not possible, Archer, that they're going to develop at some point, and there's going to be that kind of concentration, vertical integration type thing, where somebody is controlling this thing all the way down the line, and you're going to run right smack into the anti‑trust problem you had back in the twenties with the motion picture industry. They're talking about it right now.
TAYLOR: Yeah, I know they are, I know they are. In fact, one of the big protestors about the concentration of ownership is a little guy in Big Timber, Montana.
PAGLIN: Here we are, back in Montana again. That is funny.
TAYLOR: The fellow who used to be, when I was there in Big Timber, that's another name, that I thought I had it on the tip of my tongue, but at the moment I don't. He died recently, but the fellow that followed him has pursued the same course, and he's a gnat, you know, he's a fly that makes some pretty good points. Perhaps not as powerful as George Morrell, who was really a little guy in a lot of ways. But one of the principal complainers and protestors of the concentration of ownership is this guy in Big Timber.
End of Tape 3, Side A
PAGLIN: The funny part you see now with must carry is the broadcasters who are now insisting upon the right to be given exposure via CATV and we live to see the thing come 'round. Well, all right, we've been going again two hours, and I don't want to tire you too much now.
TAYLOR: Well, while it's still fresh, let me go through the issue on reflectors and translators. I did a study for NCTA in '59, or somewhere in there, I don't remember when it was. I went all over the state and got photographs, and descriptions, and everything I could get on a bunch of translators, there were probably 15 or 20 that I identified, oh, they were something.
There was one in Sydney, Montana, over in the northeast corner, and Ed Krebsbach--there's a name I remember--was the broadcaster who had both radio and TV in Sydney. He also had a station over in Williston, North Dakota, just across the border. He was a kind of a "Mr. Broadcaster" of eastern Montana, he was the big guy. Interesting guy. He, I guess had encouraged at least, the building of the translator, and this one is one that I inspected. I found out where it was, and I went up the mountain top and looked at it. They had an old school bus that had been converted into something for the music store down there. It had all kinds of music things all over it, and they had parked this thing up there and used it for the shack for their translator equipment. Another one had used an old windmill for their antennae tower, and the equipment was on a board down at the base of the windmill. I've got a picture of it, grass growing around this equipment lying on the ground.
PAGLIN: That's the kind of stuff we want, if you can get it, yeah.
TAYLOR: I think I can find that report. I ran into it a while back. I don't know where I ran into it, but I think I might be able to find that report. So I did quite a study, and it was used to try and put some rationale into the whole translator issue at the Commission. Well, I think it was probably filed as an exhibit along with one of the NCTA filings on translators. The purpose was to show that these are amateurish at the very worst. It was not professional type equipment. It's junk that's been put together. In one case, the guy built a very nice, what we call a curtain antenna reflector, with about 6 or 8 antennas out in front of it. The only trouble was that all of his reflectors were perpendicular to the antennas, his reflectors were all vertical, and the antenna elements all horizontal, so the reflector didn't reflect at all. Which showed that the guy didn't know anything about the technology that he was dealing with.
PAGLIN: He took it from an illustration in an article.
TAYLOR: Either that, or somebody told him what to do, and he didn't realize that those reflector bars had to be parallel to the antenna bars. So, that was kind of funny. There was one of these in Billings, and one up in Shelby, I think. I found a whole bunch of them around.
PAGLIN: And you did a study on behalf of NCTA?
TAYLOR: I did this for NCTA, yeah. It was one of the projects that I was hired to undertake. To provide some evidence, some testimony that could be used for the technical nature, to be used in a pleading with the FCC. It began to boil down to the fact that where does the financial support for these things come. There was one newspaper ad over in Oregon that sticks in my memory as the symbol of what it was all about. They tried to collect voluntary contributions from people to help support these things, and they weren't succeeding very well. So the ad that they put in the newspaper said, "Don't be a square ‑ pay your share". When they said that you began to see what was going to happen; it was going to be the community divisiveness between the people that were freeloaders and the people who were paying their share of this television. And you just knew that was not going to last socially or politically very long; and it didn't. Most of them that you know about have either died, and I've seen quite a few of them in recent years that just plain died. Still exist physically, but nobody takes care of it, nobody has an interest in it anymore. Or in many cases now, broadcasters who are supporting these to fill in holes.
PAGLIN: And licensed by the Commission.
TAYLOR: And licensed by the Commission. That's a legitimate approach. I remember Jay Wright. Bill Lodge was one time the chief engineer of CBS and his assistant was Jay Wright. And then Jay Wright moved to KSL as the Director of Engineering for KSL, and then moved to Seattle with the KING Industry group in Seattle. Now retired, but he's still there, and I think he still has some responsibilities at KING, but primarily retired. But he pushed hard for translators. Now KSL was the one that needed it very badly. There were not very many TV stations and they needed to fill all the holes that they could fill. And so they promoted translators very hard as a broadcaster.
PAGLIN: Well, KSL is in a mountainous area, right near the Salt Lake.
TAYLOR: That's right, a lot of shadow problems.
PAGLIN: Well, as you say, it's as far as the current situation was concerned. For some years now, the use of the repeaters and translators to come over a little hill down into a gulch which would not be a normal contour of a station otherwise.
TAYLOR: One of the anomalies that turns up in this thing, you can understand the position on one side, but the position on the other side is so logical and the regulation just ignores it. Another example is Athol, Massachusetts, and I'll never forget Harry Plotkin, who came from Athol. He explained to me what people call Athol. I won't repeat that on this tape. Athol lies right across a ridge from one of Bill Putnam's station, Greenfield. It's up on the northern border, in fact, I think his transmitter's actually in New Hampshire, over the line. Athol and Greenfield are only separated by not more than maybe 10 or 15 miles. But there's a big ridge of mountains in between. So when the rule came that you had to carry the UHF station, in Athol there's no way to carry it, because there's no way you can get it. It just doesn't come across that ridge. UHF just doesn't get there. Well, it was one of those things where the rule says, 'you have to', but physics says 'you can't'. And that was just one of the things that they never took into account.
PAGLIN: Bill Putnam pushed this stuff for UHF, because he was one of the people who supported UHF. But I do remember his fierce opposition to cable at the beginning. He was very articulate and well spoken. You know, like they say, eastern elements, very articulate, good‑looking, presentable, had a mouthpiece on him. Boy, he was a dangerous opponent to you guys.
TAYLOR: Yeah, we had some great opponents in those days. Bill Grove was one, and John Cohan was one, and Marshall Pangra down in Tyler was one of our great contenders.
PAGLIN: Interesting now if you went back to see how many of them actually got into CATV after all of that.
TAYLOR: Well, of course, Craney you know, sold out. He sold absolutely everything, even his real estate holdings. I understand his wife was quite ill, and he moved to Butte. I have no idea what he's doing. He's still alive, his wife died, but still, I don't know.
PAGLIN: Well, is there anything else on this particular aspect that you want to go into now? We'll pick up the rest of it at the next session.
TAYLOR: I think that's probably a good place to quit. I got about all I could in on the translators. We had one of those little situations where there was a translator that started in Missoula. Now we didn't operate the system in Missoula. It was Dick Geis and Fred Plummer who operated it.
PAGLIN: What was the translator picking up?
TAYLOR: Well, it was picking up probably channel 4 out of Spokane, which was the only thing that was high enough to get in. But it was a little grid dip oscillator which I didn't, well, I could guess, how it got put up there, you know. Well anyway, there was a translator, and the grid dip oscillator got put up there to jam the thing. The guessing I was doing was how the grid dip oscillator got put up there, and Bob Dietz, the RI (FCC Regional Inspector) from Seattle had been instructed to come out and look into this jammer that was jamming the translator in Missoula. I was part time on the university staff. I was in my office and he came over to see me. Asked me, he knew I was in cable you know, and I had a high profile by that time, and he came over and asked me what do I know about this thing. And I said, "Well, I sure don't know very much." I said, "I can do some surmising, and some guessing, but I don't have any real knowledge at all." He indicated that he had pretty well established that this guy was a plumber who put it up there. And I said, "Well, that doesn't surprise me."
PAGLIN: Well, you guys, you know, you're a tough guy, you don't fool around, you guys.
TAYLOR: So then, there was another case, that same translator, and this was run by a guy that I knew. Somebody stuck a pin in the RG‑11 transmission line. It was a braided cable so you can get a pin to go through it, and short circuit it, so it wouldn't work. So, next time somebody went out there they found the guy standing there with a loaded shotgun. They were getting to the shotgun stage in Missoula.
PAGLIN: Yeah, no fooling around. That's funny.
TAYLOR: It was a rough session. It was the kind of thing that really cried out for regulation that satisfied people's needs. The deregulation that we're going into now pretty much goes back to the old days of do what you want to do, and I think that there's a lot of evidence that it's a wrong way to go.
PAGLIN: We're going to get into that at the end of the session. Well, very good. Just again, I have to thank you, Archer, because your point of view we have not yet gotten, at least I haven't from this end, with someone with a technical background to look at this, people who built this. We talked with Marty, we talked with Bill, but this is most invaluable, and I know we're going to have a great record here. So, let's call a halt now. Do you want to set a session now? The next session will be August 17th, 10:00 A.M., same time, same place, subject, of course, to calling. Again, I thank you, and see you in a week.
End of Interview of August 10, 1987
PAGLIN: Good morning, this is now the interview number 3 with Archer TAYLOR: and the Cable Television Pioneer's Oral History Project. This morning we are at the third session, August 17, 1987. And we are again at the office of Malarkey‑Taylor and Associates. This is Max PAGLIN:, the Executive Director of the Golden Jubilee Commission on Telecommunications again doing the interview. Good morning Archer.
TAYLOR: Good morning.
PAGLIN: You remember we covered last week the section having to do with your early involvement in cable television and your interaction with some of the other cable pioneers; formation of the industry association; and began to get into the federal regulatory response in terms of your role in the cable industry's experience with the development of regulatory policy, the congressional hearings; the problem of opposition by the broadcasters; and some of the early CATV litigations. But I looked over my notes, and feel that we have some very fascinating and useful material about the early days of cable television in Montana and then in the far West. Also, some of the narration about the early Congressional hearings and your recollections of the activities of some of the other cable pioneers with whom you came in contact. You also told us about some of your early work with the NCTA, the National Cable Television Association, on the technical problems of cable. What I want to do is go back to some of the information on your work with the cable association, particularly as illustrated in your biographical sketch. In that you speak in terms of your serving on the NCTA board of directors for a period of six years and at one point the national vice chairman. During what period of time, Archer, did this take place?
TAYLOR: I believe it was 1960 or '61 that I was elected to the board of directors, and I served for two years, and my third year was coming up, and they asked me to stand for the vice chairmanship, which I did, and was elected. That was the year that Fred Stevenson was chairman, so I'm not quite clear on which year it was.
PAGLIN: Well, that you can find from your name on the list.
TAYLOR: Whichever year Fred was the chairman, I was the vice chairman. And I had served two years on the board prior to that. When my term of office as vice chairman was completed, they made a waiver of the rule that you couldn't have two terms on the board, two successive terms, and allowed me to have another term. So I served another 3 years. So it was the period of the early 60's that I served on the board. I was still on the board when I came to Washington.
PAGLIN: I see also you were chairman of the NCTA educational TV policy committee. What exactly did that do?
TAYLOR: Educational Policy Council I believe we called it. It was a group set up by the NCTA. Loren Stone was the manager of the public TV station in Seattle, and a fellow from Seattle, Homer Bergren was very interested in the educational aspects of television and cable in particular. I was, at the time, a part‑time staff member at the University of Montana. By this time I was working, I believe, with the school of journalism, and trying to set up educational television in the university. So, I was really quite active and intrigued by the possibility of using television in education.
PAGLIN: So it was in terms of programming for educational purposes.
TAYLOR: It was in terms of promoting in the cable industry all of the uses of educational television. And as a matter of fact, it goes to a major policy position of NCTA. They wanted to find ways of making cable television essential. We were looking at 50% penetration in many markets. That means that half the people didn't subscribe. But telephone companies have got 99.9999% penetration, and we just thought that there had to be ways we could make cable television essential. We looked at a lot of different things, education was one of them. Since then we've gotten a little more, I think I can say, realistic view about the use of television in education.
PAGLIN: Now would this have been only in the classroom or only in the home as foreseen by the use of cable?
TAYLOR: Well we were looking initially at classroom truly instructional type television through the use of cable to interconnect schools, the library, administration building and so on. We also considered the idea of home study and another aspect that came up was helping the handicapped, or the home‑bound, even the temporarily sick to continue their studies by means of television. I think there have been some applications of this but it has not been anywhere near the great thing that some of us were hoping for in those days when we were working with this council. The main objective of course, was to try to make cable television more than just an entertainment medium.
PAGLIN: I don't know whether in the far West or the areas that you were in there were, for example, bilingual problems. I don't guess so.
TAYLOR: Where we were we didn't have bilingual problems. That came up in some other areas farther south.
PAGLIN: Yeah, because I remember Lester Kamen.
TAYLOR: Oh yes, he was a client of ours one time.
PAGLIN: Well he was a client of mine too when I was in practice and I can digress because it came up many times in other areas of the country. He went for the cable franchise along the Rio Grande Valley towns, Alice and Brownsville, not Brownsville so much, but the smaller towns up along the Rio Grande. This had to be '64 or '65 when I represented him. One of the things he had in mind was what you had just described, Archer, and that was ways to use cable in the home to teach the young children. To teach the young Hispanic children, and the grandparents who are taking care of them, English. Long before they got to school, and the theory, teach them English early. I remember telling him one time when we were putting together the application, I said to him, "Lester, this is what L.B.J. (President Johnson) is talking about with his Head Start Program," which hadn't yet gotten off the ground. He said "What's that?" I said, "well that's what you're doing, with a Head Start Program here in the application. He was very successful there because there was the need. It's putting cable into the home, and using it for other than entertainment purposes. But that was so funny, coming from Texas, he hadn't heard of the Head Start Program. So how long did the Education Policy Council last?
TAYLOR: I really can't recall how long. During that period though, we were at the university where I was working in the School of Journalism. We got a Ford grant to make a plan for an educational television system for the state of Montana. I was appointed to sit on the Governor's Commission on Educational Television and serve as its engineering consultant. Mary Condon was the State Superintendent and the Governor was, I think it was Aronson at that time. We prepared our report, but as usually happens in these educational television things the funds weren't there and not much came of it. We did build a studio at the university and it was built in what, if you put the words right could be called the old Women's Gym. Turned around it's the Old Women's Gym. The Women's OLD Gym. It was an old wooden building, probably built about 50 years ago. It was abandoned as a gymnasium. I guess the studio had stayed there for about two or three years and then they tore the building down. Kind of frustrating, putting your heart into building a project like that, and then having it torn down.
PAGLIN: By now they have extensive educational television?
TAYLOR: Not extensive, there are some, I haven't really checked on it, but there are some PBS affiliated stations. Instructional television has not been a particularly big thing, as much as some of us thought it should be. Most of the people in what then was called educational television, I called frustrated broadcasters. They wanted to do the kinds of programming broadcasters do but they wanted to get rid of the least common denominator stuff, and do things that more intelligent people liked to watch. But they figured they could support that with public funds. In effect that's what really has happened. It's been changed from educational television to Public Broadcasting Service, and probably that's more realistic, although when you call it non‑commercial, and then sit through their 20 minute long commercials it gets a little bit frustrating.
PAGLIN: I was going to say what was it called, some of the alternative means of financing, Commissioner Jim Quello's thing, you know.
TAYLOR: Well yeah, that's the next thing now. But I'm going back to the time when they had their fund drives. This is a commercial that would last for twenty minutes or thirty minutes, and it would just drive you up the wall.
PAGLIN: You know what happened last week though, this very past weekend...
TAYLOR: Oh the WETA?
PAGLIN: Yeah, where they got a grant, so that they wouldn't have to go through these 20 minute commercials, and I thought it was so funny that Paul Anthony who was the leader, said "Guess what, we won't have to bore you people, we got money."
TAYLOR: I suppose it got money just like the stupid commercials on the commercial stations get money, but you sometimes wonder how.
PAGLIN: I see in the bio‑sketch the mention of membership in the Montana Governor's Committee on Educational Television, which was what you were just mentioning.
TAYLOR: While we were talking about these committees I was on in NCTA. There was one I thought was really very interesting called the NCTA Research Council. Either Research Council or Research Policy Council. This goes along with Strat Smith's idea that, while he was fighting the copyright case, he didn't want us dealing with services that were not "pipeline" type services, because pipeline was the theory of his copyright defense. Well the chairman of this committee was Leonard Reinsch who was a very interesting, well, he was just a plain fascinating guy.
PAGLIN: Oh, I know him, I know Leonard back from the 50's, before he got into Cox Cable.
TAYLOR: I'm sure you do, I'm sure you do. The purpose of this council was, the cable operator still wanted to get into what we were then calling auxiliary services, non‑entertainment type services, and this council was to investigate all these things and come up with some answers.
PAGLIN: What kinds of things did they have in mind?
TAYLOR: Oh, meter reading, security, remote security...
PAGLIN: Did they think about paging at that time?
TAYLOR: No, I don't think they were talking about paging. I remember meter reading particularly and home security particularly. Well, the Council needed an executive secretary; we recognized that a volunteer committee doesn't get a whole lot accomplished. You have to have somebody paid, work at it, and come in, and put the policy ideas before the council. So who will we get for that, and in the discussions Leonard Reinsch said, "I think that I can get Ken Cox to come and do this job. Ken is very unhappy at the Commission, he has been passed over twice for the chairmanship and he looks like he's going to get passed over again. And he is very, very unhappy about it." I think we could get him." Now Leonard knows Ken very well, and he's very savvy, and so we authorized him to try it. Well before he could get to Ken Cox he was appointed chairman.
PAGLIN: Well wait a minute, who was appointed chairman?
TAYLOR: Ken Cox was appointed chairman.
PAGLIN: Of what?
TAYLOR: The FCC.
PAGLIN: No, he was never chairman.
TAYLOR: He was never chairman?
PAGLIN: No, no, no.
TAYLOR: Oh, I know, he was in the Broadcast Bureau, he was appointed to the Commission, that's what he'd been passed over twice then.
PAGLIN: Oh Commissioner, right.
TAYLOR: And he had the thought that because he was Senator Magnusson's right-hand man that he had tremendous power, and he should be appointed to the Commission. Not chairman, I'm thinking of, my memory failed. Well, they finally gave him Chief of the Broadcast Bureau as a sop, and that was it. And he wasn't very happy about that but he finally decided he'd swallow his pride and take it. Then when it looked like President Johnson was going to pass him over for the appointment to the Commission, Leonard thought that this would be a ripe time to bring him on board. Now I've always felt Ken was one of our great enemies, in a sense, but a very bright man, a very capable man, and a man of considerable integrity, high integrity. Had he come on in the cable industry he could have been a powerful force for us, but instead of that we missed just by a matter of a few hours probably, and he got appointed as a Commissioner.
PAGLIN: That's a fascinating story, see, I didn't know that. I had been at the Commission for, you know, a hundred years and I was then number two in The GC'S Office (General Counsel). I was then Chief of Litigation. I had even been appointed by the Republicans. When the Kennedys came in '61, well it was natural that I would make a pitch for becoming General Counsel. I had known Ken Cox and because of this when he worked at Magnusson. He was the head of the committee on the UHF inquiry, the years '55 through '58 or something like that. Then the word came out that he was going to be appointed to the Commission, and then the word came out, forgive me, I shouldn't get personal, but it works right into this, the headline in Broadcasting Magazine: Cox, General Counsel, Paglin, Chief Broadcast Bureau.
Well that wasn't the deal at all and Ken didn't realize that he wanted a policy job, obviously, and he didn't realize that the chief of the Broadcast Bureau was the policy job. General Counsel was, you know, Chief Counselor. So my supporters got back up on "the hill" and said wait a minute, that's not the job you want. If you want anything to get commissionership, you want policy, you're going to have to be chief of the Broadcast Bureau. Next week Broadcasting Magazine carries: Cox, Broadcast Bureau, Paglin, General Counsel. And that's how it happened.
And then as you say, he had expected to become commissioner. But, he did a great job. Ken, is as you say, one of the finest Commissioners we ever had. As you say he turned out to be very anti‑cable, as history showed.
TAYLOR: I had met Ken Cox first when he headed Senator Magnusson's office out in Seattle, and I had a client that I needed to do a little lobbying for. So I went and talked to Ken about the situation and got to know him that way. Over the years he's always been personally, very friendly, even though when he's sticking the knife into the cable industry, he'd still be very friendly.
PAGLIN: You should hear what some of your colleagues think about Ken Cox.
TAYLOR: Oh, I have no doubt, I have no doubt. But ever since that policy council when Leonard Reinsch tried to get him on board, I had always thought that, had we not had the bad timing, that it could have changed the whole, well maybe not the whole future, but it could have advanced it very rapidly, very precisely.
PAGLIN: You're absolutely right, Archer, because Ken is not only a man of the highest integrity but he's one of the best lawyers, and one of the best administrators that I have met. I used to see him work with his opponents. He tried to persuade the Commission to his position and if he didn't succeed he would assist the majority in brushing up their opinion. That's the kind of guy Ken Cox is up till this day.
TAYLOR: This leads into something that I really thought should have come earlier but this is a good place to bring it in, because Cox did something that I've always admired and most of the industry did not. It was probably late 50's or very early 60's, when broadcasters were charging that cable television operators deliberately, this is after we began to get cable in single station markets. The broadcaster in the market would claim that the cable operator there was deliberately degrading his signals, so people would look at the other signals. I never could comprehend the logic behind this. There is absolutely no motivation for a cable operator to deliberately degrade the local signal. As a matter of fact, Bill Daniels made a public announcement of a $25,000 reward to anybody who could provide evidence that this was in fact happening. He never paid the $25,000 because no one ever put in a claim. But we had that problem, I lived in Missoula and we had a station in Missoula at that time.
PAGLIN: A station?
TAYLOR: A television station, I don't mean we had a station. There was a TV station in Missoula at that time, there was also a cable system. And the TV owner/broadcaster was complaining that the cable was degrading his signal. Now I pondered this for quite a while and finally discovered what was really going on. Because the broadcasters in marginal markets well, they really couldn't do well anyway, they cut corners anywhere they could, their equipment was not very good, they didn't have high caliber technicians, they get their network feeds from a long way off, from cheap and dirty microwave that was not adequately put in. They had all kinds of problems, so they just plain and simply didn't have a good signal. Well, when you're the only thing in town, the only thing you can watch on your TV set, that's all right. As I said in something I wrote recently, the "Taylor Principle" is that television doesn't have to be good, it has to be better than it was before. Anything that was better than it was before, you know, that's what you need. So even though it wasn't very good, people would watch it, and like it, and everything was fine. Now when cable comes in, and brings in a pretty good signal from out of town, all of a sudden the local station is inferior from the one that's coming from out of town. There was no deliberate degradation, in fact, it was really the broadcaster's fault. But we never could get a forum to prove that, no one would listen to us.
That then comes to another point. This is a story I really wanted to tell. There was a rule that you could not duplicate a local station, including a translator. Non‑duplication rule, I'm not sure whether this is in the 1968 rules or earlier. Maybe earlier. So there was a VHF translator that came into Kalispell, where we had our system and the picture on that translator was absolutely horrible. Yet we were going to be required to black out our signals that came from Spokane, in pretty good shape, in order to carry this lousy translator.
So I figured I could petition the FCC for a waiver, of this rule, under the circumstances, and here are the circumstances. We built an antenna on top of a 7,000 foot mountain which is about 21 miles north of Kalispell. It's about 150‑160 miles from Spokane, and we picked up all three of the stations, one of which was on a fairly high mountaintop. The other two were down in the valley, and we picked them all up pretty well. Then we ran maybe a mile, mile and a half of cable from that pick‑up site that we had over to a microwave site. And at that time the cable operator couldn't own the microwave so it was a common carrier that happened to be owned by the Missoula operators, not the broadcaster but by the cable operators. Then at the microwave station there was a split, and about 10% of that power was beamed down to Kalispell, to our place, to carry the three signals for our purposes, for our cable distribution. About a 21 mile hop. But the main power, 90% of the power was beamed 106 miles, across Flathead Lake to another mountain, called TV Mountain, which is where the local broadcaster in Missoula is operating. There it was relayed not to the TV station, but relayed down to the cable operator down in Missoula, who then took the signals, put them on his cable system, and distributed them to his subscribers. One of his subscribers was the local TV station, who then took a tuneable Conrac demodulator, connected to this subscriber drop, and when he wanted NBC he would tune it to channel 6, when he wanted CBS he would tune it to channel 4, and when he wanted ABC he'd tune it to channel 2. But remember, he's coming off the cable drop now, so he takes that signal, then he microwaves it back up to TV mountain (about 10 miles) and then puts it on his transmitter, his channel 13 broadcast transmitter. From there, it went about 85 miles up to Kalispell where it was picked up by the translator. And that was what we were supposed to protect?
PAGLIN: What was the condition of the signal by the time it reached there?
TAYLOR: Well that was the point, it was terrible. But I thought that anybody in their right mind once it was explained to them how that signal started at Big Mountain, microwaved 106 miles, microwaved another 10 miles, put on a cable system, distributed over the lines of the cable system, put through a Conrac demodulator, put through the studio switching facilities, microwaved up to TV Mountain, put on a broadcast transmitter, transmitted 85 miles, that's a long way for channel 13, then put on a UHF translator. I didn't have to do any more than to tell them that those could not possibly be equivalent signals.
Well, I went farther, I took Polaroid photographs of the wave forms that show how it's performing. Then, because I was a consultant, but I was also an owner, therefore I could be prejudiced, I hired a consultant from over in Wenatchee, Washington, George Frese, to come over to look at the situation and give me an affidavit on it.
All right, this was filed, and it didn't take maybe 30 seconds for the Commission to send it back to me, and say he hadn't proved the case. So the waiver is denied. So, I then went to my friends at Dow Lohnes and Albertson, and Jack Matthews talked to me about it. He prepared a case that was filed in the 9th Circuit Court, appealing the FCC ruling on this. Turned out that this was about the time that we'd decided to sell the system and so when we sold it to H&B American, H&B dropped the suit and nothing ever came of it.
PAGLIN: Nothing ever came of it.
TAYLOR: That to me was the kind of treatment that cable operators were getting from the FCC. They had no standing, and therefore nothing they said would be listened to. They wouldn't accept it.
PAGLIN: That is no status.
TAYLOR: No, not standing, standing is a legal term, certainly they had no clout. It was even reversed, we had negative clout. If it comes from a cable operator that's prima facie bad.
PAGLIN: How did Ken Cox get into this?
TAYLOR: Well, we sold in 1968 so this probably took place in '67, early '68.
End of Tape 3, Side B
TAYLOR: Ken Cox gets into it, because he was the one that I've always attributed, but am told maybe not properly, the clause in the 1972 rules which I think had been used in earlier 1965 rules that set the standard of no material degradation within the technological state of the art, or something of that sort. And to me, that was an excellent standard. Admittedly, it's got some vagueness to it, it isn't objective, it isn't specific, but it's as good as the "public interest" standard, which is always subject to many handy interpretations. But I thought that standard of "carried with no material degradation within the technical state of the art" was a very good one. I've been told subsequently that Ruth Reel at the FCC was the one who generated this language. But I've always attributed it to Ken Cox, because it's the kind of thing that he would come up with because it's an intelligent thing to do, you see.
PAGLIN: Well, she, you know, was a staff person.
TAYLOR: Well, the thing about it is, is that it deals with this degradation issue without being pejorative, without saying that we know cable operators are degrading the signal deliberately. But it just says you must carry it within the state of the art, and of course, if the degradation occurs before you ever get it...
PAGLIN: That reminds me of what I used to say years and years ago in terms of argument. You argue and argue and argue and argue, until you've lost the train of thought. What we used to say was you slice the bologna so thin that you could see light through it, and it's not bologna anymore. Is that what you're saying? You know, that that signal wasn't a signal anymore.
Well, I wanted to get back to these things because it gets important in terms of what your contributions were. I think you mentioned in an earlier session about your service on the CTAC panel on picture quality, and also past president of the Board of Governors, of the Broadcast Cable and Consumer Electronics Society of the IEEE. Was that particularly directed toward cable or was it just in your engineering qualifications?
TAYLOR: Okay, there were two separate things, let me talk about the CTAC first. When Sol Schildhause came in as chief of the task force...
PAGLIN: Yes, what I set up when I was executive director in 1966 was the Cable Television Task Force.
TAYLOR: When that came in, it was apparent to many of us that the Commission did not have a sufficient knowledge of the technology of cable, and that therefore we went and talked to Sol and talked to some others, Hub Schlafly and two or three others in our group, went to see if we couldn't get a blue ribbon committee established to talk with the FCC. Out of that came a formal formation of an Advisory Committee which had two arms, one was the Cable Television Technical Advisory Committee, which I was interested in the other was the Cable Television Federal State and Local Advisory Committee. It had to do with the regulatory matters, federal, state, and local regulatory ‑ FSLAC, they called it...
PAGLIN: All the technical stuff?
TAYLOR: No, No, No. All of the non‑technical things. Strangely enough when the appointments to the committee came out, although I had been active in getting it started, I was appointed to the non‑technical side, not to the technical one.
PAGLIN: Who made the appointments here, the Commission?
TAYLOR: Greene, Susan Greene. She was a staff member of the General Counsel's office, I think.
PAGLIN: Susan Greene was on the Children's Television Task Force. A staff member, maybe?
TAYLOR: Well, I got it mixed up then.
PAGLIN: A staff member of the Commission?
TAYLOR: Yes, a staff member of the Commission had appointed me to the non‑technical committee and appointed Martin to the technical committee. So, we got that straightened out, and then it became a question of who was going to be chairman, and I kind of lost out to Hub. Hub became chairman.
TAYLOR: Hub Schlafly, Irving Kahn's right hand man. Hub's a very competent guy, I don't want to denigrate him in any way whatsoever, he's very capable, and a very fine gentleman. So I took the position of alternate chairman. They didn't want to make a co‑chairman, so they made an alternate chairman. But I had quite a bit to do with organizing and setting the thing up. We set up working panels, and I was named to the panel on picture quality. After CTAC was finished and made its final report, I wanted to see some studies done on the subjective effect of some of the distortions that occur strictly in cable, that don't occur in broadcasting.
We needed funding. I tried the FCC, and Bob Luff at that time, department of plans and policies, I don't know if they called him chairman but he was head of that division, whatever it was. I talked to some other people, and we just didn't get anywhere with funding from the commission, which is not surprising. Finally, somebody sent us to Al Schinn at the National Science Foundation, and Al arranged for us to get some funding. We hired as our psychometric expert, a fellow named Rod Welch, who had been a student of Al Schinn's, when Al was a professor. Welch was a good man, but was one of these people who had a problem with completing an assignment. In fact, I was warned about that, because Al warned me "Find out when he's going to finish his doctorate, he's got all but a little bit to do to finish his doctorate and he just doesn't ever finish it." Unfortunately, in the course of this project, we had with the Science Foundation, we got our tests all done, and had all the computer printouts stacked up ready for analysis, and Rod Welch was having serious coughing that didn't seem to go away. He went to a doctor, and the doctor told him he had lung cancer. This is a kid 32 years old, never smoked in his life, so he went to the hospital so they could remove a lung to get rid of the cancer, instead of that they found that the cancer was wrapped all around his bronchial tubes and they really couldn't excise it, so they put him on chemotherapy. Well, the end result was that the project never really got the analysis and the publication that it should have had. But it was an interesting project anyway. I enjoyed working on it.
PAGLIN: But nothing ever really came of it, in terms of publications.
TAYLOR: Well, minor publication, we had calls from up at CBS laboratory, just before they folded the CBS laboratory.
PAGLIN: Is that recently then?
TAYLOR: Oh, yeah, this has been within the last year. I got a call from Bronwyn Jones from CBS labs, and Leroy DeMarsh from Kodak, both of whom were on the CCIR committee, on subjective ratings of television pictures. They had learned about our study from a couple of papers that I had published, but they were not definitive. We had quite a conversation, and I wasn't even sure at that time whether Rod Welch was still alive, but they found him, they located him, talked to him, and got some interesting things.
PAGLIN: So the data was still available?
TAYLOR: The data, well at least the conclusion, not the real data, the raw data, but some analysis data and certainly opinions were done, and some of our work was published in one of Bronwyn Jones things in SMPTE but more by way of comparing, they had a new technique they wanted to use, and we had used it, as a matter of fact, 10 years ago.
PAGLIN: What was the date of the CTAC stuff?
TAYLOR: Oh, about 1974, '75. So it was an interesting project. Now, we go to the IEEE. I had long felt that cable fits in between broadcast transmission and receiver, and we tried to adapt to make the two things fit. But we had to do it independently; we had to do it without any cooperation from either end, from the broadcaster or the receiver manufacturer. Transmitters were built and broadcasting was done for receivers and vice versa, and receivers were built to receive the transmitter signal over the air and consequently they didn't exactly function properly on cable. So this is where we got into converters and adapters and all kinds of problems because of that. I felt that we needed to talk together and exchange ideas and make things work. I also had a theory. In those days we had about, oh maybe 10% of the homes using television sets were connected to cable. We're now up to some 40%. I generated a number, I said in my mind, when we reach 30% penetration, we'll begin to go over the hill. Things will begin to go our way. It turns out that some other people had hit on that same 30% number and actually it turns out to be that that's about when things did begin to go our way. So, I had long wanted to see us all talking together.
I belonged to both the Consumer Electronics Society, and the Broadcast Society, had belonged to broadcasting for many, many years. Howard Head became president or chairman of the society. I got to know Howard pretty well. At that time we had offices on Connecticut Avenue at N and he was in the NAB building across the street. We were 1225 and he was just right around the other corner. As a matter of fact, Martin could look out of his office window and see Vince Waselewski sitting in his office. Well, Howard and I worked together on a number of broadcast matters in which I would bring in the cable TV point of view...
PAGLIN: He was with the NAB at the time, then?
TAYLOR: He was?
PAGLIN: Howard Head?
TAYLOR: No, no, no, he was A. D. Ring's man.
PAGLIN: You said Vince Waselewski.
TAYLOR: Well, A. D. Ring had offices in the NAB building. You could lease offices in the building. Vince Waselewski was with the NAB.
PAGLIN: Right, because he's now on 19th street. Well, A. D. Ring's firm is on 19th street. Because Vince was always with NAB, I didn't remember Howard Head being with NAB.
TAYLOR: Well, that's just because it was the NAB building where A. D. Ring was located. Howard and I then talked quite a bit about this need for cooperation between the two industries, and we brought in Harris Wood, Philco, who was then an active, chairman of the Adcom or something of the Consumer Electronics Society, and the three of us, Howard, and Harris, and myself had a lot of meetings in New York with the IEEE Administration, and finally came up with the merger of Broadcasting and Consumer Electronics into a new society that would be called Broadcasting, Cable, and Consumer Electronics, BCCE. It was logically an excellent idea. One of the nicest things about it is we decided to put out three publications, Broadcasting had always had its publications and Consumer Electronics had its publications, both of them were quarterly, I believe, and so, cable was going to put out a quarterly publication. We staggered the dates so that they didn't come out at the same time, so actually the society was then publishing a monthly publication.
Well our problem was to keep getting papers. Getting papers for this publication was very difficult. Jim Herman who was at Jerrold, and had been a member of the IEEE Publications Board, agreed to serve as editor for the publication. But he left Jerrold and went to work at Motorola in Phoenix, and continued the assignment as editor. But Motorola's interests were not like Jerrold's in cable, so that they were not too keen on him spending time on it, so it became spare time, and that got difficult. Finally, he fell farther and farther behind in getting the papers sent in, and finally that was the end of the publication. So then we began to look for another editor, and I persuaded Bob Powers, who at that time was an engineer with the Cable Bureau.
PAGLIN: Is this the Bob Powers that later became Chief Engineer at the FCC or Chief Scientist, now called Chief Engineer again. They decided that this was a Chief Engineer, not a Chief Scientist, some kind of political thing.
TAYLOR: Yes, same Bob Powers.
PAGLIN: He was then on the Commission's staff?
TAYLOR: Oh yeah, he was in the Cable Bureau, or whatever they called it at the time. So he became editor. But again, it got to be a spare time operation with him, and Bob fell farther and farther behind. Finally the Post Office Department threatened to remove our mail privilege because we weren't fulfilling our four issues a year like we had said we would. We just didn't succeed. The merged organization split apart again, and cable got dropped in the crack. So it didn't happen. One of the things I think contributed to this was that the SCTE, Society of Cable Television Engineers, got started, and it attracted the interests of the cable television technical people. The dues were maybe $20 a year or something like that. It's higher than that now, but at that time it was about $20.00. It cost you about $60 ‑ $80 to join the IEEE. I had a hard time explaining to people what do you get out of IEEE that you don't get out of SCTE. The thing that I am sorriest about, is that our "Transactions" while we published them for about oh, I guess a year and a half, maybe two years, were distributed to 400 libraries all over the world. It was an archival publication that could be referred to by anybody else, who was writing and wanted to search. It would go into computers you know, so it would turn up on the search. Most of the stuff that we publish now there isn't any way to find it, it isn't archival. I feel badly about that.
PAGLIN: Is there another facet to this, which may or may not have attributed to what happened. Is it your view that in the cable industry contrasted to other facets of either telecommunications or electronics in general, that the technical people were more oriented to what I would call hands‑on operation rather than research, intellectual inquiry, and so on. I'm only asking you the question. Possibly, they weren't interested in this kind of sitting down and writing articles as some other engineers do.
TAYLOR: Well, I think that that's true, but I think that there's another angle to it, and that's that the most prolific membership societies in the IEEE are those that are associated with government contracts or government agencies, DOD for example, or are in the academic pursuits where "publish or perish" is the issue. So in those cases they have tremendous motivation to publish, the time to do it, and the funds to do the research that are necessary. Our business is a bottom line business, and that's just what you're saying, they just simply didn't have time to sit down and publish anything. In the manufacturing business, that's the suppliers, the Jerrold's, the Scientific‑Atlanta's and so on. There's been a lot of good, applied research done, developmental things done, that are excellent. Much of that could have been published, but again, they were in a bottom line business, and they just did not have the time nor the motivation to publish. We tried to generate motivation but then somebody always had to be there to keep driving it; "Hey when are you going to get that paper to me, you promised it three months ago. When am I going to get it?" Somebody has to follow through, because it isn't self motivated.
PAGLIN: It isn't like the Bell Journal that comes out quarterly.
TAYLOR: That's almost an academic thing there.
PAGLIN: Yeah, that has all these esoteric, scientific articles which advances the state of the art obviously, and for cable particularly it seems to me such a thing would be necessary, but like you say, somebody's got to move the papers and move the writers.
TAYLOR: I might say that one of the things the engineering committee at NCTA is now talking about is the possibility of establishing, I won't call it a Bell Labs, but a laboratory of some kind that is an industry laboratory and could do some of these things. Bell had the advantage, of course, it's a monolithic company, or it was. Now that the divestiture has happened, Bell Labs is not quite the place it used to be, and that's one of the sad things about the divestiture.
PAGLIN: And the Bell Communications Research organization that houses my Jubilee Commission is interesting. Some of the Bell companies who organized and support BCR are questioning whether or not the money put into this for the various forms of research is really worth it. This is competition, but the wrong kind in my view. That is the companies say, do we want to pay money to let Southwestern Bell get the benefit of what we're looking for?
TAYLOR: Well, we'll have the reverse problem in the cable industry, the operators will say "Well, why should we put money into a research operation that isn't, may not pay off. You know, nothing may come of it.
PAGLIN: But it's short sighted, wouldn't you say?
TAYLOR: Well, I think so, but then I think our industry has had a considerable amount of myopia, too. You know, I really can't say that because we've been up against some pretty tough competitive media, still are, what with VCRs, and SMATV competition that has no regulation. We're regulated and we're competing with people who are not regulated.
PAGLIN: For the purpose of the transcribers, SMATV, you know, they wouldn't know what SMATV is.
TAYLOR: Satellite Master Antennae Television.
PAGLIN: That's right, yeah, that's right. Well, I did want to get some of this because of your status as the technical person that we're talking to for the first time, and I wanted to get some of this background because as we see, it's very important.
TAYLOR: Before you move into the next phase which I sense that you're about to do. I mentioned Bob Powers, there's a whole other area in the Federal regulatory scheme that I think is worthy of describing.
PAGLIN: As a matter of fact, you must be reading my thoughts, because my next section was to ask you whether there was material on the outline section for a federal regulatory response.
TAYLOR: Bob Powers, I first met him, probably 1969 or '70 sometime about that period. He was a Bureau of Standards chemist. Bob is not even a chemical engineer, his Ph.D. is in Chemistry; but he got interested in cable television, CATV, out in Boulder, Colorado, where the Bureau was located and got sufficiently interested that he became a very active Bureau of Standards participant in various committee work and things that were going on. We had, at the IEEE, ahead of this BCCE society, an organization called CCCCS (Coordinating Committee on Cable Communication Systems). It was kind of a task force committee, I was chairman of it, and Bob Powers was a member. But going back, just a little background of what I'm about to talk about, but going back to, oh, very late 50's, I first was talking with Earl Hickman, who was vice president at AMECO....
PAGLIN: That was Bob Merrill's company?
TAYLOR: Bruce Merrill.
PAGLIN: What was his name Hickman?
TAYLOR: Hickman, Earl was his. This was different from Dick, who's another engineer of the time, no relation at all. Earl had built a couple of cable systems in the very early 50's, '51, '52 maybe in Arizona, and couldn't buy Jerrold equipment like all the rest of us, and so he decided to build his own, and got, I don't know how he ran into Bruce Merrill, but anyway, he got Bruce to help him finance the building of new equipment, and out of that came the company that's now known, well, it's defunct now, it was known as AMECO. Earl was a very smart engineer, a gentleman, very high integrity. We were talking one day and he said that he made the comment that we ought not to use the frequencies between the top of the FM band and 120 MHz because that is where the air navigation is, radio services are.
Incidentally, he's an aerobatic pilot, he built a German biplane, World War I Messerschmitt, built it, and he flies it to these aerobatic circuses and so on, really quite a flyer. So he knew flying, and he knew the radio aspects of it, radio navigation, and his point was, in that band, in the navigation band, all of the instrumentation is automated. You don't use human interpretation, the signals are there and they show up on a meter. So he felt that with no human interpretation, interference in that band would be rather serious, and therefore we should voluntarily not use those frequencies. We didn't need them, we had plenty of spectrum anyway, so we really didn't need to use them.
PAGLIN: This is for what operation?
TAYLOR: To use them for cable, because recognizing that cable can leak at times, and things can go wrong and so on, best just to stay out of there. And I couldn't disagree with him. Others had picked up the same thought, George Brownstein in Los Angeles, with International Telemeter, and later he was on the basic converter patent for example, a number of other things. Phil Hamlin, who I had met on the very first trip I had made out to the West Coast, had picked up the same idea, and a lot of people recognized we ought not to use that band, because of the air navigation.
Well, by about early 70's, 1970 perhaps, FAA was beginning to squawk about cable, using the air navigation frequencies, and the hazard to air navigation, and it was enough of a subject that we took it up in that CCCCS task force committee, and Bob Powers was appointed chairman of the subcommittee to look into it, see what position we ought to take on it. Well, that was about 1970, and he began to look into it, and by 1971, Sid Lines, who was in the Chief Engineer's office at the FCC and was the guy assigned to cable television technical regulations, this was for the 1972 rules, and he was the guy that was getting the heat from the FAA, but he was resisting it, the whole Commission was resisting it, they just felt that it was a nuisance thing and it's not really serious, but, it's got such a tremendous public implication that the FCC couldn't just overlook it.
PAGLIN: Let me footnote just again, for the sake of a future researcher, could you explain in what manner these frequencies would be used in terms of the cable operator?
TAYLOR: Cable originally started by using the same television channels that broadcasters use, particularly those in the VHF band, which are identified as channels 2‑13. When we began to look at having more channels than the twelve channels in the VHF spectrum that were available, we decided or considered going into the space in between the FM band and channel 7. Because there was about 66 MHz in between there, it's equivalent to about 11 channels available to use without extending the bandwidth of the system. Now broadcasting was set up not to use those for broadcasting because of various intermodulation distortion problems. But we felt that we could handle those on cable so that we could use those 11 channels in between. We didn't need 11 channels, we'd be satisfied with 2 or 3 as a matter of fact, so this is when the concept of let's not use those first 2 channels because of the possibility that we might interfere in air navigation. So Sid Lines came to us with information that the FAA was pushing awfully hard, and they wanted us to try and come up with some solution to this problem that the FCC could live with so we didn't have to wipe everybody out.
The problem was, to state it succinctly, that the FAA wanted protection, wanted cable to not use any frequencies between 108 and 136 MHz, and between 225 and 400. Well at that time we were looking at only maybe going up to 260, 270, at the most, 300, so they wanted to wipe out everything above channel 13 for us, and almost everything in the mid band between the FM and channel 7. There wouldn't be much left, and some of us also got concerned that if we just wipe these out for safety to aircraft, what about the stuff that's in the band that they're allowing us to have which is land mobile, and some of that is in the public safety business like police, ambulance and fire, so on. They could have a proper complaint that public safety was at stake there too, and so if there's a danger on one, my gosh, the danger is on the other. They just looked like they were going to wipe us out of everything, except for what was assigned for broadcasting. The industry couldn't live with this. By this time the FCC was not wanting to wipe us out, they wanted to support us. So they didn't want to see us wiped out on this. Sid came to us and pleaded with us to come up with some kind of a solution. So Bob Powers really became the chairman of that effort. He still was with the Bureau of Standards, or the Department of Commerce, I believe. By this time he had moved to an office of communications in the Department of Commerce and he had an office here in Washington.
PAGLIN: Would that have been NTIA?
TAYLOR: No. NTIA was the successor to the OTP.
PAGLIN: Yeah, this would be the OTP.
TAYLOR: No, it wasn't even the OTP, it was the Institute for Telecommunications Science in the Department of Commerce. Armig Kandoian was his boss, the head of that department. Armig had been vice president, I think, of ITT up in New Jersey and moved into this as a kind of retirement assignment. It was broader than just cable, but Powers was there because of his interest and knowledge of cable. Our theory in this IEEE committee in 1970, '71, when we were trying to find what to do was, we've got to look at this as an engineering problem, you don't throw the baby out with the bath water, you find out how to get rid of the dirty water. First of all, you have to identify where is the problem.
So Powers, through his Department of Commerce connections arranged with the National Bureau of Standards to conduct some actual tests on the interference susceptibility of air navigation and communications equipment. Primarily air navigation at this time because that's the one we thought was so sensitive. The curious thing is that we found out from the Bureau of Standards test and subsequently from some Canadian Department of Communications tests, of the same nature, that the air navigation equipment is so carefully designed to be free of interference, that the probability of interference from even a bad cable system, that's just leaking enormously, is almost negligible. It's just so small, because it was designed to be that way. It was designed to be immune to interference, and it was very nearly so. Well about that time, we were visited by, we had Garth Kanan, who was at the FAA, and he was the principal man representing this subject, come and meet with us, and oh, he was terrible. He just said the only way you can avoid this problem is to just get off of it, no other answer, you've just got to get off of it. He at one point said in a meeting where I was a chairman he said, "You know, you fellows use 250 watts in your cable system, you know that's an awful lot of power, that can cause a lot of interference." And I looked at him and I said "250 watts? Where did you ever get that, it just isn't so, there's not a thing in our systems that comes anywhere near 250 watts." "Well, I see it in your advertising." I said "You have? Well can you get me a copy of that?" "Sure, I'll get you a copy of it." Of course he never did. I have no idea where he got the 250 watts idea.
PAGLIN: What did he say, why did he say that, or was he just making it up?
TAYLOR: Well, because he was just so intent on getting us out of business in the aeronautical bands. I don't know how all this developed, but the committee talked. Somewhere in here Delmer Ports was appointed to, Norm Penwell had been the chairman, or the Engineering Director at NCTA. Just as an aside here is that I was chairman of the engineering committee, and realized that you can't do this with volunteers. NCTA doesn't have a technical staff member, they need one, because we're constantly running into things that need doing, and we just can't get volunteers to do it. So, I recommended to the committee and the committee recommended to the board that the NCTA employ a technical staff member. The board approved the idea, and a selection committee was set up. I was chairman of the selection committee, Jim Stillwell was a member, and Hub Schlafly, I think, was a member. By this time Norm Penwell was working for Illinois Institute of Technology out in Annapolis, ECAC plant. I still maintained a relationship with him. One day he was in town and I was driving, and he was sitting in the passenger seat and I just commented idle information that NCTA has agreed that they will hire a staff member. Isn't that a real good idea? He got real quiet for a minute, and he said "I'd like to apply for that." I said "great". This was probably in 1968 or maybe like '67. I went back to the selection committee and said Norm Penwell has indicated that he'd like to be an applicant, but I'm so close to Norm Penwell over the years that I will just have to withdraw from the selection committee, which I did. Oh, Wally Briscoe was a member of the selection committee. But, at any rate, the committee interviewed Norm, I guess they interviewed some other people, since I withdrew from it, I really have no knowledge or recollection of who they interviewed but they decided to hire Norm. So he was the first Engineering Director at the NCTA, the first staff member. And who was president? It was the guy from Pittsburgh, Don Taverner, I think.
PAGLIN: Was Fred still there as a....
TAYLOR: No, Fred came in after Taverner.
PAGLIN: Well, let's see, wait a minute, cause Fred, cause I know, I was the counsel who negotiated his contract, Fred came on, January 1, 1965. He left the commission...
TAYLOR: That's right, that's right.
PAGLIN: I know, I negotiated his contract, I was then in practice.
TAYLOR: So Taverner must have come on after Fred then, because Norm worked for both Fred and for Taverner. So he started with Ford, I think, and then Ford left, I'm not sure when, but Taverner...
PAGLIN: I thought it was about '69 when Fred left, I don't know, but we could check that out.
TAYLOR: But Norm couldn't get along with Taverner, at all. I knew he was unhappy, and we had a need for somebody at Malarkey‑Taylor so we hired him. We hired Norm away from the NCTA. That was in 1971, because he brought to MTA, the contract with the OTP, the Office of Telecommunications Policy at the White House. This was in '71, yes, '71; because the nature of the project with OTP was to, the guy we dealt with was Sebastian Lasher, remember Seb Lasher? Who became aide to the chairman Dean Burch.
PAGLIN: Lasher? I should know that because I served under Burch.
TAYLOR: Anyway, even at the OTP at this time, in 1971, Nixon is president, coming up to reelection in '72, I guess that was. So the project that we got was to tell the government what the government might do to help build a critical mass in these non ‑ entertainment type services, all of these blue sky things that we were talking about. What could the government do to stimulate this, and help get it off the ground, get some of these blue sky things going. We worked on it, and published a report, in November of 1971, but Norm was a project leader in that project, did a great job. He was also the guy that brought us the job, because he was riding back and forth to Annapolis with Bill McCruchan, who is currently one of the MSO's guys with cable. But anyway, I digressed to tell a story to tell how Norm became Director of Engineering at NCTA.
Oh, when we brought Norm to our office, there was a vacancy at the NCTA of course, and we were advertising letting people know that there was a vacancy. Delmer Ports walked into my office. Well, Delmer Ports was Jansky-Bailey, I mean he was the president of Jansky-Bailey. When I had been with Paul Godley, I had come to recognize that Jansky and Bailey was the Mount Olympus of the consulting fraternity. As a matter of fact, when I decided to leave Godley and go out west on my own, it was just a little bit after I made the decision that Dan Hunter called me from Jansky‑Bailey. He had been at WMAL at the time I worked there, but was now at Jansky and Bailey. He called me and said that there was a vacancy at Jansky and Bailey and would I be interested in taking it? Well if he'd called a couple of months earlier, before I'd made a decision, I would have jumped at it like a trout jumps at a fly. But, as it was, I'd already made the decision, and I just didn't think that I wanted to change it. Logic went into the decision, so I thanked him but, well, that was Jansky and Bailey. So here comes the president of Jansky and Bailey to me, I was ready to get down and bow on the floor, you know, Jansky and Bailey, it was that kind of a company. And Delmer sat across my desk, and after pleasantries were exchanged, said "I understand...
End of Tape 4, Side A
TAYLOR: . . . There's a vacancy at the NCTA, I would like your help, I want to apply for it." You could have knocked me over with a feather duster. You know, it's incredible to think that this guy, you know, who I thought was the head of what I thought was the Mount Olympus of the broadcasting/consulting industry, now coming to apply for the engineering director at NCTA. Well obviously, I said certainly I'll help you, and I did. There was no question, he was appointed very quickly, and did a magnificent job. It was really sad that he should die, that hurt me very much. He was such a fine person and such a capable engineer. But he came in, you see, at just about the time that this aeronautical thing was busting open. He came in probably in 1971, just as this was beginning, and he, although, our committee at IEEE had carried the ball at first, he picked it up and carried it for NCTA.
PAGLIN: Delmer, Delmer Ports.
TAYLOR: Delmer Ports. So I don't know how the concepts were developed. There was a lot of conversation; Paul Fox at OTP was pretty much involved in this. He came later to the Commission in Plans and Policies.
PAGLIN: Yeah, when I was over there as a consultant. It was '77‑'80.
TAYLOR: Bill Carnes, who was at Air Inc., Annapolis Airlines, Operations.
PAGLIN: Oh yeah, I know Air Inc.
TAYLOR: Bill Carnes was pretty active in insisting that cable just get off of all of our frequencies. I had known Bill because he and I worked together on a lot of this IEEE stuff, worked very cordially together; he gave me a lot of advice, sound advice, but oh, he was certainly against us on this issue, absolutely against us.
I remember one meeting at the OTP, it was attended by some FCC people, and OTP people of course, and this was when Tom Whitehead was head of the OTP. Representatives of the two airlines pilots' groups, one's a commercial, and the other's a general aviation, I can't remember the names, letters of those two organizations, but they were there. Air Inc. was there, Bill Carnes was there, and the conversation went on. Bob Powers was there on our committee, and I guess Delmer was there, I'm not sure. Somewhere in there, Bob Powers came to the FCC, the Cable Bureau, I'm not sure of the timing or how that worked out. I distinctly remember the Pilots' Associations at this OTP meeting saying we must have zero probability of any interference, and the only way we can see to get zero probability is to just not use those frequencies, at all. Well, it just appalled me, because in mathematics and statistics there is no such thing as zero probability. You can make a smaller and smaller and smaller number, but there is no zero probability. We pointed out to them that there are so many other interfering things up there, the local oscillators of FM receivers, just flood the area.
PAGLIN: Also the bonding, the synthetic bonding thing that Ray Coates...
TAYLOR: Yes, there are just all kinds of things that just fill the air with interference, and you want to get zero probability by wiping us out, and all the rest of this stuff just stays there. You know, we just couldn't see the justice to that, and kept saying let's find out what the problem is and find a solution that deals with the problem. And first of all we did get them to admit that it would be a malfunctioning cable system, not a normally functioning cable system that was a problem. That was a beginning of logic. Well, Delmer and Bob Powers did yeoman lobbying work, Delmer was an excellent engineering lobbyist, he was very capable of talking to non‑engineers and people not familiar with his engineering, getting his ideas across, he was just excellent at that. Well, finally they came up with this offset arrangement that we have, I don't remember the date of that, late 70's probably, in fact, I got called in because Delmer died, and the case was just hitting a very critical point, and I knew enough about it so the NCTA hired me to come in and fill in for Delmer because he was gone.
PAGLIN: And you were already at Malarkey‑Taylor?
TAYLOR: Oh yeah, this was late 70's. All of this was after I was with Malarkey‑Taylor. I came with Malarkey‑Taylor in 1964. But out of this came the 100 KHz offset agreement. I talked with Bob Powers about it, he said "I know we don't need 100 KHz, I just know we don't need that. I know we don't need the power limitations that we've put into this rule." But he said we had to get something. At least we defined the engineering issues, we defined where the problems are, so that you don't have to just throw the baby out, we defined what bath water is, and this was an attempt. He said "I know it's overprotective but we'll come back and change it when we have some evidence.
In the middle of this comes the Harrisburg problem. This Garth Kanan from FAA sent us a memo, and sent memos all around the country to the FCC, and so on telling about Harrisburg. It seems that pilots came in to make a landing in Harrisburg one day and their radios just went crazy, communications radio. Got squeals that were weird, and oh, he built it up as a horror story. The fact of the matter as it turned out upon investigation, they had just shifted the communications channel from some frequency to 118.25.
PAGLIN: The airline people.
TAYLOR: The airline people, or FAA, I'm not sure which, the FAA. It also so happened that the 118.25 happens to be the pilot carrier that Jerrold's plants used at that time. They designed it around 118.25 as the pilot generator to control the level of all of this. The Harrisburg system, which was also built by Jerrold was now expanded, and owned by Sammons. But it was expanded to four areas, and they used AML microwave to feed each of these four areas. But the microwave was not phase‑locked, so the pilot carrier is transmitted by microwave and it comes out to be close to 118.25 but it isn't precise. It doesn't lock to it. So the pilots would pick up on their communications radio a leakage signal on that frequency, they'd get two or three, and the difference in frequency would give this audio whistle that they were hearing, and sure, it was bad, there was no question about it.
My information was that the Harrisburg system, or one part of it at any rate, was heavily done with what we call pressure taps. These were taps that you just cut into the cable, and screw them in, and they make contact, but they tend to be quite leaky. So my judgment and most everybody except the engineering director for Sammons insists that that was the reason for all the leakage at Harrisburg. There was a lot of leakage, there were four different frequencies, all being together, and pilots coming in that never experienced this kind of interference there before, so it was a bad situation. There were no accidents or tragedies, it was just that the pilots were angered by the situation and of course anticipated that they could have a problem.
So that was one of the horror stories that happened, while this thing was in progress. So Bob Powers, it was after Delmer was gone that the judgment was made, but Bob made the judgment that you can't ask for what you really think it should be because you've got to satisfy them. So the 100 KHz was an offset that was just too great. Well, there were some problems in notification and finding out what frequencies you had to protect, and there was that kind of unworkable situation because the FAA could change these frequencies around without telling you. You might be on a frequency that they've moved to and so it was a kind of a clumsy and unworkable thing but at least we were getting to the engineering problem of trying to devise solutions to the existing problem. We were recognizing by now, that the problem didn't exist everywhere, the problem existed in certain specific ways.
PAGLIN: A malfunction or a leakage, or something like that.
TAYLOR: A malfunction and particular frequencies. Out of that, came the idea that the NCTA, the FCC, and the FAA would jointly sponsor an "in‑the‑air" test procedure to see just what happens over a group of cable systems, both good ones and bad ones. They naturally wouldn't identify which ones they were because they didn't want to make anybody feel that they labeled this as a bad one.
They did use the Arlington system, which was brand new at that time. They used it because there were no subscribers on it. They could do a lot of things with it, it was brand new. They put out some deliberately leaky pieces of cable. They took some cable that they stripped the outer stuff off for about 3 feet, and just let it hang there. They did everything they could to make it leak. Well, the difficulty was that they had a little trouble getting permission to fly over Arlington with the National Airport right there. But they did get some permission to fly, and they did. Came up with a mass of statistical data; they had computers on board the aircraft...
PAGLIN: This was an FAA aircraft I take it.
TAYLOR: Yeah, FAA aircraft, with the FCC and the NCTA participating in the full project. They went on the ground, and they made ground studies, so that they got a real thorough statistical correlation between what you see on the ground, what you see in the air, and came to some conclusions. The thing that came out of both the tests and the analysis that had been done, otherwise, was that it really is the communications bands that were more sensitive than the navigation bands, because of the fact that the navigation aids were built to be interference free or at least insensitive to interference. Communications did have a problem, and we could see that there was a problem.
So on the basis on the findings of the three agency test efforts, the flying test, a report was made and a proposal made to the FCC that we drop the power limitation, and raise the minimum leakage field strength, from 20 microvolts/meter up to 100 microvolts/meter and change the offset requirements to a much narrower offset, eliminate certain frequencies and so on.
PAGLIN: What was that intended to do?
TAYLOR: It was to ease the burden on the cable operator so that he didn't have as much of a problem in meeting the requirement, and still meeting the aeronautical requirements. The Commission wouldn't go along with relaxing all those things. I guess they felt the public relations aspect would be too, well it looked like they were giving in to an industry's sensitive public safety issue too far. And I could understand their position.
So that just sat as a proposed rule making for a long, long time. Finally, in the mean time, Garth Kanan left the FAA, and Cliff Paul of the FCC set up a computer process of being able to analyze the frequencies you were going to use in your cable system and pinpoint the conflicts that existed with the FAA. One of the problems was some of the frequencies that we might interfere with were classified, military frequencies. They wouldn't tell us where they were, so how can we protect them if we don't know what we have to protect. Even some of the FAA frequencies were classified, and the FAA didn't want to have to consider telling us when they made a change in frequency, so it became a problem of our knowing what frequencies had to be protected. So Cliff Paul and the Cable Bureau set up a computerized procedure which was working fairly smoothly, except unfortunately, I think, cable operators weren't as worried as they should be about this thing, they weren't as conscientious as they ought to be.
Then we had the case up in Flint, Michigan, I don't know whether you heard about that one. Somebody flying at 25,000 feet had interference. I think it was in the air nav area, some kind of interference that they made a horror story out of. There was I don't know all the details on this, that was a Comcast system, but there were some stories that there had been sabotage on the cable system. Somebody had gone in and actually slashed the cable, over a length of it. Other stories were that at 25,000 feet there was no way that you could get even a receivable signal. There's no way it could happen from a cable system unless you were carefully looking for it, searching to find it. So there was some feeling that somebody had put some other body up to finding this thing, going after it, to try to create an incident. Comcast, unfortunately, handled the thing a little bit cavalierly, and got into bad trouble at the Commission. The Commission was going to take away all of their licenses, microwave, and various other things. It got to be pretty serious. Dow Lohnes called me in to go up and make a technical inspection, and see what I saw to be the problem. To outline a course of action to correct any problems I saw, and file a statement with the FCC to try to get Comcast in better standing.
PAGLIN: Out of hot water.
TAYLOR: Yeah, out of hot water. Well I got up there and I found out that Comcast had bought the City of Flint System from Michigan Bell who'd put it in as a lease‑back, back in the early days. It was the most horribly built system that one could imagine; you just couldn't imagine anything built so poorly as that Michigan Bell System. Unfortunately, this tended to be typical of the lease‑backs that the telephone company built. It's always appalled me that the telephone companies had such great skill, such great technical knowledge, and among other things, they knew how to build a rather sophisticated telephone network with people who didn't know anything about volts or ohms or anything else.
I had a very close friend in Missoula who was a specialist for Mountain States Telephone Company in installing these PBX boards. Well those things are sophisticated, they are complicated, carrier telephony in them. But the way he did it was if you knew you put your meter on pin number 19, and then picked up the red wire over at pin number 75, your meter should read in the yellow, and if that's the case then you're all right. But if it reads in the red, then here's what the trouble is and you go and do something else. That was the way the thing was done and it was magnificent to use semi‑skilled people who really didn't know any of the technology.
PAGLIN: Paint by numbers.
TAYLOR: Paint by numbers, right. They did a great job. Well, they thought they could do that with cable television and it just ain't so. They made mistake after mistake. I could cite a whole series of cases that I've been in where things were so poorly, poorly built.
PAGLIN: On these lease‑back arrangements?
TAYLOR: Lease‑back arrangements. That was a disaster. It was a disaster for everybody, although the telephone companies usually managed to negotiate a pretty fair sell out when they sold to private user. They probably came out all right. It was a terrible thing. So I have grave misgivings when I see here's District of Columbia as being a lease‑back. Maybe C&P is wiser than they were back in the 70's when they were doing this. Well, the system that Comcast had built outside the city of Flint, wasn't really causing a problem. It was inside the city that was so bad, and I set up a program for them, well, worked with them; I didn't do it, I worked with them to set up a program in which they would go out and measure leakage pole by pole. Every pole inside the city, they would make a leakage measurement. I went out with them on a sample trip on this. The snow was about 18 inches deep. Some of the poles you couldn't get to. Between Dow Lohnes and our study, and some contrition on the part of Comcast, they got away with a maximum fine, $20,000 was what it cost them, and a slap on the wrist, but not any loss of licenses or other problems.
There had been 2 or 3 other aeronautical cases, I'm not as familiar with those as I am with the Harrisburg ones, and the one with Flint. To my knowledge there's been none that had any serious actual danger to the public, but they were there.
PAGLIN: In your explanation Archer, the attitude of the FCC vis-à-vis cable, vis-à-vis FAA, was what? Being concerned about public safety, but by the same token, attempting to see also that cable is not overridden by what FAA wants. Because, like you said, cable is within FCC's jurisdiction.
TAYLOR: Going back to Sid Line's time, when he was presenting the kinds of heat the Commission was getting, definitely reflected the view that they did not want to wipe out cable television. They wanted to find a way to satisfy the FAA and the public interest in public safety, which is of course, their responsibility. They had to do that, none of us argued that case. Zero probability, that just can't be.
PAGLIN: Well, the reason I ask that, Archer, is because it fits in with the general approach. The anomaly of the Communications Act vis-à-vis, air safety, is that the responsibility of jurisdiction for air hazards, is in the Communication's Act, in terms of the antennas, broadcast antennas. And I just say this by way of background, that the Commission has long had problems with the FAA in terms of broadcasting. And this goes back to years before cable. But the Commission has always felt that the Congress has always put a degree of air safety, as a part of air navigation, in the Communications Act, in terms of where an antenna tower should be.
TAYLOR: That was a physical hazard of a high tower.
PAGLIN: Right, right, and the Commission on a number of occasions told the FAA, "Of course we'll listen to you, but we have the legal responsibility for making the ultimate determination of whether or not this is an air hazard." Now that's kind of strange really, but the court's upheld it.
TAYLOR: There's another ambiguity in the procedure, of course, the FCC is responsible for radio interference between the services that are licensed by the FCC. But, the FCC has really turned over the licensing and assignment of aeronautical radio, mobile aeronautical radio particularly, I guess all of the aeronautical radio, to the FAA and in certain instances, to the Air Inc. They make the decisions, they make all of those decisions. The FAA simply puts them in the book. The FCC is not making those interference decisions.
PAGLIN: That, my friend, is another kettle of fish. That has to do with the attitude of the Commission of delegating, in my view anyway, delegating a considerable amount of its responsibility. Goes back a long time, too. But the line between giving it all away, without any supervision, whatsoever, in my view, and giving the delegation of the day by day stuff, which is obviously useful, is a question of philosophy, really I think.
TAYLOR: Well, this, of course, created a part of the problem, because then FAA became the one that was administering the frequencies, but they didn't have the, let's say, the competence in communications, or the knowledge, nor the legal powers to regulate the interference issue, and so there was an ambiguity here. Personally, I think it's been resolved in a very remarkable way, and at one time I was in a rather strong disagreement with the NCTA engineering committee's position. Very frankly, Frank Bias felt that we are a closed system, that you can't interfere out of a closed system, and therefore, if we could prove that we're a closed system by monitoring, we should not be obliged to have offsets. If you're not a closed system, then the offsets are a good answer but then forget the monitoring. He said you can't require both. Well, I felt this was a real world situation, and a real world isn't as perfect as that. I didn't think that it was an unbearable proposition. So I disagreed with the engineering committee's position and I really think that it was basically Frank Bias, who was chairman of the committee at that time. After he retired from that position the engineering committee's position has been much more cooperative, understanding. The rules that the FCC put out in 1984 was, I think, on aeronautical things, I have to say, was one of the worst jobs of regulation drafting that I have ever seen, and I'm not really an expert in that field, but it was terrible, absolutely terrible.
There was a meeting called over at the NCTA's conference room, at which the drafter of the rule, and Steve Ross who was the staff attorney, I don't know what his position was, was there. Ralph Haller, who was the engineer originally, of the field bureau, but now I guess the broadcast bureau or whatever they call it, the mass media bureau. Prominent engineer, Ralph had been a participant in this flight test that had been done by the three agencies. Very knowledgeable and able guy, but we sat at this, and there were maybe a dozen, 15 cable TV engineers at the table, and this was a meeting called to clarify what do the rules mean.
Time after time, the question would be asked, "Well does this mean so and so?" Steve Ross would look at the lady who did the drafting and they'd get into a huddle and start talking and "Well, this is what it means." "But that isn't what the words say, the words say something diametrically opposite to that." Steve would say "Well, there are some problems with the language that we're going to have to do some changing but here's what we meant." Over and over again they did this, they said that this is not what we meant. The words clearly said, and sometimes the words would say this over here, and the opposite over here. You know it was the most awful bit of drafting that you ever could imagine. Well, petitions for reconsideration went in and they went through some monkey‑shines not doing the reconsideration, but they did issue a clarification which didn't clarify at all, they muddied the water still further.
PAGLIN: By the way, not only in this interview, just to footnote, there's been a complaint, shall we say, in other areas of the FCC jurisdiction about the poor drafting, and the poor articulation of opinions that the Courts have even gone into this. The court castigated the Commission for using language like "Well, we don't really think it's constitutional but we have to leave this to Congress" Do you remember that? And the court said "Wait a minute, you guys took an oath to uphold the Constitution, you think there's an unconstitutional part about it, you better do something about it then." Well, it's been like that in a lot of other fields.
TAYLOR: I understand how it came about that way, but the drafting of the thing was thoughtless.
PAGLIN: Right, right, that's a problem.
TAYLOR: After all is said and done, after they finally shook this thing around quite a bit, well, there's another step that happened in here, while Cliff Paul...
PAGLIN: In the same air navigation thing?
TAYLOR: Oh yeah, in the same air navigation thing. While Cliff Paul had the computerized thing to clear the use of frequencies, the FAA was beginning to become a great deal more reasonable. In fact, so reasonable, that at one point, I said "If that's what the FAA is agreeing to, I think they're wrong, I think they've agreed to too much." I think they gave away the store. We in the cable business like it, but it did not seem to me that it was doing what the FAA really intended to do. They were waiving the rules rather widely and got down to the point of waivers that they were granting that enabled them to then come up with another offset rule, which is the one that came out in 1984. By the time they finally got it all cleaned up, so that the tracking made reasonable sense, it's still a little bit confused but not too bad at this point. Then they postponed the effective date of one of the more onerous things until 1990. It's a livable document and we're beginning to learn how to live with it. I still think there's a lack of conscientious appliance on the part of the operators.
PAGLIN: And there is the problem.
TAYLOR: That is a problem, but by now, I think the regulations are at least livable and there's some experience that has to be developed on how to monitor what's happening and how to report it and so on.
PAGLIN: Because at base, Archer, what you're saying if I understand correctly is that this is a problem because at base it involves safety, doesn't it?
TAYLOR: Yes, it does, I have a feeling, and this is just a gut feeling, and I don't know, I have no reason to say that the FAA will do this, but it looks to me that if I were the FAA, I would look at the frequencies that the cable industry is now using, and say, hey, let's assign other frequencies. But they are going to stay put on those frequencies. They aren't going to move around.
PAGLIN: Cable will.
TAYLOR: Cable will, and let's just get a little bit farther off of those. On our own, let's just not walk into that problem.
PAGLIN: But would that have consequences in terms of aviation equipment?
TAYLOR: Oh no. No, because the aviation receivers will tune across the band and so it's just saying instead of going to 118.25, let's go to another frequency that's maybe 100 KHz away from that or so.
PAGLIN: So it's just establishing the different frequencies.
TAYLOR: Yeah, right. Now that you know what these things are doing, and actually if you're going to go into Kentucky or whatever, we'll find out what that cable operator is doing, what frequency is he using, and, we'll assume that he's using all of these frequencies, because he can under the new rule, and he'll have to be offset and be precise, and you can know what he's doing. You don't have to be notified, you don't even have to go and ask him. And then there's lots of room around. And then when they come to the issue, and Ralph Haller raised this with me, he said "This is a nice rule now, it seems to be workable, but that's because our channels are 50 KHz apart. We're going to divide those channels and put one right in the middle, well that's where we put you on offsets, is right in the middle."
PAGLIN: So if they decrease the separation between channels you may face the problem again.
TAYLOR: That's right, but, I think that when that happens, there's a very easy solution, if the FAA will accept it, and that is that here's a 6 MHz channel, and you've got, oh, I don't know how many aeronautical channels in that six MHz, and you've got two on either side of this cable operator that you ought not to use, or the one that's right on it.
PAGLIN: Would they be like guard bands. To be able to select guard bands?
TAYLOR: Not even that. It would be just one frequency that you pull out of your allocation procedure, you use anything else, but just that one, stay off of it. Use all of the others that you want to, but stay off of that one. Well now I think there'd be two probably that you'd have to stay off of, because he could go up or down, either one. I think that they could not lose, insignificant, maybe 1 or 2% at the most of possible allocations by splitting channels. And undoubtedly that's what will develop when the time comes, hopefully they'll realize that they'll have to live with this cable thing out there.
PAGLIN: Well, because of the spread of cable, assuming that it's still growing, and the spread of aviation, will require further accommodation, that's what you're saying.
TAYLOR: Yeah. I think the thing that I wanted to get on this report is that back in 1970, in one of the IEEE committees, with Bob Powers as chairman of the subcommittee and working on this, we wanted to find an engineering solution to this problem and not "throw the baby out with the bath water", and I think we had found it. In other words, this was a successful exercise really starting with an IEEE committee to get it going. IEEE committee has long since ceased to exist. Bob Powers, of course, is now gone from the Commission. Ports, who worked on it, is gone from everywhere.
PAGLIN: Bob Powers went into his own consulting business, didn't he?
TAYLOR: Gee, I don't think so, I think he went with MCI.
PAGLIN: Oh yes, yes, excuse me, right, right, he did when he left the Commission. Well, this is an interesting story of what was, and could be and was, a critical problem.
TAYLOR: I doubt that there has been anybody in the industry that has been as close to that as I have, living now, except for Bob Powers, who's not in the industry. Delmer Ports was closer, he knew a lot more where the Indians were buried . But of those who are around now, I don't think there's anybody who knows as much about it as Bob Powers and I do.
PAGLIN: I would say, in summing up, where a problem of public safety arose in terms of cable operation, that had to be accommodated. Is that correct?
TAYLOR: That's correct.
PAGLIN: And ultimately was accommodated.
TAYLOR: I believe it's been accommodated in a good manner. Now we don't have zero probability, but then we never of course, had it anyway.
PAGLIN: But as you explained there is nothing like that.
TAYLOR: It seemed to us incredible, that they would make us get off the frequencies entirely, where there were so many other potential interferences that any pilot who was wise, even barely intelligent, would have to take into account in his communications. He has interferences, and there are ways that he deals with it, you know. There are ways to deal with it.
PAGLIN: Yeah, because there are a lot of industrial operations.
TAYLOR: Many of these interferences are posted on the bulletin boards in the airports. The pilots go through and these things, they're on their note pads. They get the information, and they have it. They know, when you go into New Orleans, you have to watch out for that intermodulation beat between three FM stations that are there. It's always there, no matter what happens, it's always there on your communications channel. So you don't have zero probability, you get some interference. But both sides have to learn to live with it, and have to learn to cooperate with each other.
PAGLIN: As is the case with many, many things in life.
PAGLIN: Well, Archer, again, I thank you, and I think that this is a place that we can stop and we've wrapped up a very interesting problem, which I had known a little bit about, but I didn't realize that it had so substantive a base nor that it had taken so long to solve. Well, I thank you again. Now, next time, and by the way, as I said before, any time between now and the next session, when things come to you, and I notice you're writing these little notes; that's great. Please, by all means, let me know because there is no structured outline as such; yeah, there is, but nothing that's put in concrete that we can't go around so long as we know what the subject is.
TAYLOR: It's a little bit in the wrong sequence, but one of my notes, and maybe it would be better for me to put this little comment in now, rather than get into it later. I have felt for a long time that we would not have the problem with the legislatures of the states, nor with the Congress, if it weren't for the fact that cable television was really not feasible for rural areas, and that it cost money, so therefore it tended to discriminate against the poor people. As long as we were in that position, legislatures could make hay out of the politics. And so, I couldn't do anything about having to pay for it in the poor areas. That was something I couldn't do anything about, but the poor areas would generally have access to broadcasts over the air, not the same things that we had, but they were not totally deprived either. Rural areas, yes, there was some real deprivation in some of those areas. So how can we get cable in the rural areas and overcome this political disadvantage.
PAGLIN: In fact, that happens to be an area which I have set out for our next session.
TAYLOR: Should I leave this then?
PAGLIN: Yeah, I think I'd rather get into it in more detail next time and I have a note here and we'll get into that because it fits in with the regulatory policy of the local government and the municipalities as well as Congress and where this thing was supposed to go. All right, I thank you again.
TAYLOR: Chronologically, this thing I was about to tell you, something that happened in about the mid 60's, '65, '67, something like that, and had to do with this issue.
PAGLIN: You'll find that you'll develop an issue, as we have, from the early 60's or maybe before, and bring it up to date. Then when we get to another subject, you kind of go back again, start "putting layers on lasagna" or chocolate cake. That's what we find, and it's necessary, because it's difficult, we've found, to do this on a strictly chronological basis, because what you are doing is you're mixing up a lot of issues.
TAYLOR: Yeah, not when you're depending on memory to organize this.
PAGLIN: Right. We've found it's better to get this organized in terms of issues and develop the issue, albeit it overlaps in terms of chronology. Fine again. Do you now want to set another time? Let's say Monday, August 24th, at 10:00 A.M. again.
TAYLOR: Good enough for me.
PAGLIN: Great. All right, I thank you again, Archer, and we'll see you again next Monday.
End of Tape 4, Side B
PAGLIN: We're in the offices of Malarkey‑Taylor and Associates to commence the fourth interview with Archer Taylor, in the oral histories project of the Cable Television Center and Museum. It is Tuesday, August 25. Good morning again, Archer.
TAYLOR: Good morning, Max.
PAGLIN: First do you have any notes that you've made on the subjects we've previously discussed that you would like to include before we proceed?
TAYLOR: The only thing is, I could not remember the name of the man that was in the educational policy council of the NCTA back in the early days, and I have recalled it, it's Homer Bergren from Seattle.
PAGLIN: The Educational Policy Council?
TAYLOR: That was the Educational Policy Council. He was very much interested in the educational uses of television, particularly cable.
PAGLIN: Was he affiliated with a system?
TAYLOR: Yes, I guess he was working with the McCaws out there... There was a system in Seattle, down by Lake Washington that I know he was involved in, Phil Hamlin was probably involved in that too.
PAGLIN: What we'd like to do this session then is to speak about your recollections of the problems with local government policy and the regulation of cable television in the early years, particularly how the early municipalities developed their franchising criteria. I remember your speaking in our early sessions about problems with the telephone and utility companies regarding the pole line attachments, and some of the problems about competition for the franchises. If you would, start with your recollections on some of the early days.
TAYLOR: Okay, I got into franchising rather late, because as I explained earlier, my good friend, John Vance in Missoula and the city council had told another applicant that he didn't need a franchise. The arrangements with the utilities were such that the cities had full protection that they needed through the arrangements with the utilities. So we started our system without a franchise, and as I began to learn in later years about franchising, it came as kind of a shock to me. I didn't realize that people were having to go through this. The practice was apparently to offer the city 2% of the gross revenue, and John Vance simply told Jack Zeckman that "I'd like to take your money but there's really no reason for it. We don't need a franchise." To this day, Montana does not have cable franchises.
PAGLIN: Now how did they arrive at, you say 2%, of the gross revenue?
TAYLOR: Well, as I say, that happened before I got any knowledge of it and I learned about it later, so I was kind of a "Johnny‑come‑lately" in that area. For some reason, cable operators in some places felt that they had to go to the city to get the use of, to be able to string wires over the streets. I do know this; that Ed Parsons, down in Astoria, Oregon, told me when Norm Penwell and I were down there, at first he just strung his wires from his house to his neighbor's house, and somebody else wanted it, and he strung another set of wires, and literally, it was a rooftop to rooftop thing in Astoria.
PAGLIN: A community system.
TAYLOR: Well, strictly community, and it was really a neighborhood, and it really didn't go very far. When they began crossing the streets, the fire department got a little exercised. They began coming at him, and saying, "Look, you really can't do this, we can't have wires crossing the street in the air just wherever you feel like it without any control or regulation." So the police powers of the city were beginning to be exercised even in that early date.
PAGLIN: So that would have been in the '48, '49 period?
TAYLOR: Yeah, '48, '49, '50 somewhere in that period. I'm not exactly sure when. So this was when they felt they had to go to somebody to get authority to string wires. So I presume, and this is pure presumption on my part, I presume that they figured maybe that they had to offer the city something in order to get the permission, or maybe the city said, "Well, we'll give you permission but we want something to pay for it." I don't know how it developed, that was before my time, before my familiarity with what was going on.
PAGLIN: But in Montana, there were conditions of some kind, were there not?
TAYLOR: Not with the city. The conditions were you had to get a lease with the utilities. Our experience was that you go to the power company, and they couldn't care less, "Sure, go ahead, it doesn't bother us." They were satisfied with $1.50/pole rental. In fact, they said, "Look, we've got a joint agreement with the telephone company, and we pay them $1.50, they pay us $1.50, so you pay us $1.50." That's where it started. However, the telephone and the power companies had arranged things so that the payments each way were approximately the same and it really didn't matter what the amount was. It could be anything, as long as it washed out. It was just a paper number that they could put down. "I pay you a dollar and a half, and you pay me a dollar and a half." But when the third party comes in, then it begins to have some meaning. When you go to the telephone company, they have some very definite ideas. They were willing to go along with the price at that time, but they wanted to make sure your system was built according to certain codes, which really existed at the time.
PAGLIN: Codes of what kind?
TAYLOR: Safety codes, at that time, the National Electric Safety Code was something done by the National Bureau of Standards as a kind of a service to put out ideas on what should be done for safety reasons. This was later consolidated into a volunteer national code called the National Electrical Safety Code. But, at that time, the codes were largely generated by the utilities themselves, and the Bureau of Standards was trying to bring a little standardization into these codes, and it was cooperative, and they had a "code committee" at the Bureau of Standards that consisted of industry people, telephone, utilities, and power, not cable, not television. The space on the poles was divided up into communication space and electric power space. So the telephone company naturally had more concern over the communications space as they call it. Consequently, the telephone companies became the administrators of the lease agreements. The power companies would go along, but they didn't care very much, it didn't bother them, as long as the telephone company was happy, why they didn't have any real concern.
PAGLIN: So those were actual written lease agreements.
TAYLOR: They were and still are. They're legal documents, fairly precise about what they require. They're written by the telephone company, and as you know, whoever writes the contract has the advantage. They were written for their protection, and not for cable television's protection.
PAGLIN: And so far as your personal experience, at least in the beginning, with Missoula, Montana, the municipality, had no interest as such in it? This is something that they let the phone company, or the utility company handle with the cable company.
TAYLOR: Well, it was explicit in Missoula, where John Vance, as a councilman, advised a potential applicant that you don't need it. As a result, when we went to Kalispell, we didn't even bother talking to the city, we made our deal with the utility and proceeded. We did recognize that we were in a business, and there was a business license that you had to take out. The right to do, you know, if you're going to do a shoe store, or a grocery store, whatever, city business license. So we did take that out, but it has not very much in the way of requirements, like $15.00/year fee, or something less, some nominal fee. Other than that, we didn't have any connections.
PAGLIN: So as far as the city was concerned, their awareness of your existence, was either through somebody observed an application for a business license, or saw construction on poles.
TAYLOR: Well, we did have some publicity that we put out on what we were doing, press release, and so on. Furthermore, the attorney, who was one of our stockholders, was also the attorney who served the part‑time job of city attorney. So, you might say he had a conflict of interest, except for the fact that there were no legal requirements, so there couldn't have been a conflict. We felt later on that there were some conflicts. For example, there was a period of time when we had frequent house movings. Jack the house up on rollers, and roll it down the street, move the whole house.
PAGLIN: Why would you do that?
TAYLOR: Well, if somebody wanted the house at a different location, move it to another lot.
PAGLIN: Oh, I see, the owner of the house.
TAYLOR: Yeah, the owner of the house, and for a period of time there, several years, we'd run into this, oh, maybe 3 or 4 occasions a year, and that's quite a few occasions, and of course these houses were more than 18 feet above the street, so it always involved arrangements with the utilities. Well, there were two utilities.
PAGLIN: In other words, moving the overhead wires.
TAYLOR: Yes, the overhead wires were in the way, and so the moving people would go to the utilities and tell them, "Look, we're going to be moving down such and such a street, on such and such a day, at such and such a time." So the utilities would have somebody out there. Nobody thought to ask the cable people about it. So, when they got to it, they'd just take cutters and cut our cable, and the first we'd know about it was when a customer complained and said, "Hey, my cable's gone out." We'd go, and find that it had been cut by a house mover who'd run through.
Well, we took it up with the city attorney, who just happened to be one of our shareholders, and he kind of took the side of the city on the thing, "Oh, just send a man out there." Then we got into the position of sending a man out. He might be there all day, and the house might not come by. He might go out the next day, and still the house wouldn't come by. In the meantime, there are repair calls waiting that he hasn't taken care of. So he'd finally go take care of repair calls. While he was gone, the house would come by, and they'd cut the cable. We could never get the city to assume any kind of responsibility.
PAGLIN: Why would the city have any responsibility as contrasted with utility company that actually did it; in other words, who cut the cable?
TAYLOR: Well, it would be the moving company. The moving company, I presume, had to go to the City for a permit to go down the streets, that would be fairly apparent, and I guess this is one of the penalties we paid for not having a franchise. Because, if we'd had a franchise, then I'd presume the City would have instructed the moving company that "You've got to take care of this for our franchisee." But, since we weren't a franchisee, they didn't even bother notifying us.
PAGLIN: How did they handle the utility lines, the telephone and power lines?
TAYLOR: Well, anybody has to separate the line and get it out of the way, and then put it back together again. The moving people just simply cut it just to get it out of their way, whereas the utility, or we, if we happened to be there, would cut it at a place where we knew we could splice it, take it out of the way, and put it back promptly, and in a proper technical fashion.
PAGLIN: So the moving company would first notify the telephone company or the power company, they would have somebody there who would separate the line. They would take care of their own lines. As far as the cable company was concerned, you didn't exist in their eyes.
TAYLOR: That's right, they'd take care of their own lines, and restore them. Incidentally, one of the curious things about Kalispell is that the telephone company and the power company were one and the same. There was a utility called Mountain States Power Company which was one of the few power companies that also operated the telephone business. They had acquired it when independent telephone companies were being acquired by various people. The strange thing is that the telephone region, the Rocky Mountain Region was called Mountain State Telephone Company, and here this company in Kalispell was called the Mountain States Power Company, and it happened that it handled the telephone. So it got a little bit confusing. Subsequently the whole company was acquired by Pacific Power and Light, who continued to operate the telephone business, and as far as I know it's still operating, PP&L.
PAGLIN: So at this time, from your experience Archer, you're not running into problems, such as they did in other areas of the country where municipalities were really setting down, fairly concrete, and sometimes complex franchise criteria.
TAYLOR: Well it wasn't until the latter part of the 70's, I think that the really complex franchises began to be generated. The franchise agreements prior to that might be two or three pages at the most. Mostly boiler plate, mostly legal protection of the city so that it would be held harmless, and so on. It wasn't until the late 70's that the cities began to say, hey, we need more control over these operations.
It was probably in the 60's that educators began asking the cities who were franchising to set aside channels for education. There was a time that they were just flatly asking for 25% of all channel capacity to be set aside for education. Some cities bought that, but most did not. What it really came to was that the early franchises awarded were simplistic business licenses with a few little legal requirements. But when they came up for renewal is when they began to look for serious terms.
Perhaps one of our experiences in Kalispell is an example of things that were coming up that didn't result in any regulation in Kalispell, but it was certainly threatened. We were charging the usual $3.75/month for service, and $135.00 for the connection and installation charge. But the industry was moving away from that high installation charge, because we could now get financing through banks, and more customary sources. So the $135.00 installation charge was being dropped, and as a promotional thing you would get it down to a very low amount. In fact, you would give it away at times on special deals. But the $3.75 was not really enough to pay the freight, so it was time to raise that. We decided to raise it, but we were just a little bit slow in making our decision. We wanted to raise it before the new Fall programs came on, and the excitement began to build up again. We'd begun to realize already, that in the summertime people just, it falls off, you know, to keep the subscriber count, but in the Fall it comes back. Everybody's interested. That period, say from September to December, to Christmas, was the big period for selling drops. We decided that we needed to get this rate increase in before the Fall service began, but we had gotten started a little too late.
We'd been charging for the service after the fact, rather than in advance. We were scared, frankly. We just didn't think we could get people to pay in advance, so we would bill them after a month's service. We wanted to move it up to the advance, so we did. We raised the rate to $5.00. If you look at it, that's a 1/3 increase, a pretty husky increase. We raised it to $5.00 and at the same time we made it into an advance payment instead a post, after the service payment. Well that hit the fan in September. It really created a ruckus. One of my receptionists who answered the telephone, had to leave the telephone, and go in the back room, and have a good cry because she was so upset at the angry phone calls that came in.
Well, as it turned out, we had threats. We had threats from the city. There was a new city attorney at this time, it wasn't our shareholder anymore. In fact, I think we had bought out the shareholder by that time. So there were threats of legal action against us. It was then that we discovered that our subscriber contract had no termination clause. It had no way for us to terminate subscribers for any reason. It was drawn up by a lawyer, and I won't identify the lawyer , and when we found that, our hands were kind of tied, so we developed a policy then that, if people complain bitterly, we would give them the option of disconnecting. You don't have to take the service, it's voluntary. But it you want to come back, there will be a reconnect charge, and you will be paying a new fee, that's your choice. Well, the chips were down, and the only ones that finally seemed like they were going to take us to court, I think there were about two or three subscribers who threatened to take us to court, but even they finally dropped it, nothing ever came of it. We could not determine that we lost any customers as a matter of fact.
PAGLIN: Their theory was that they had a contract at a specified rate with no termination, and that it was forever, as long as you owned the business.
TAYLOR: That's right. That was their theory. And legally, I suppose they were right. So we decided to honor them in a certain sense, but managed to make it sort of unpalatable.
PAGLIN: So what was the City's position in this?
TAYLOR: The City didn't take any position, but it was the kind of thing they could easily have done. If that were done today, I think it would probably trigger the city to institute some kind of regulatory jurisdiction.
PAGLIN: What were the terms, I mean the franchise, did it have a specified term, 15 years or something like that?
TAYLOR: Well, see, we didn't have a franchise. The lease arrangement with the utilities was, as I recall it, 20 years, but I'm not sure of that. The only option the city would have had would have been to require us to do something more, either a franchise or licensing, you know, they had various options that they could have undertaken, but apparently finally decided that it was not worth doing.
PAGLIN: Would it be fair to say as far as the municipality was concerned, that, so long as the company was rendering a good service, a needed service, at a reasonable price, and the citizens were not too unhappy that the municipality felt, "So what's wrong with it?"
TAYLOR: Well, this is in the period when, if you wanted television in Kalispell, you signed up for the cable, it was that simple. There was no other way to get television. Consequently it had all of the bad features of a monopoly, we were able to raise rates with a squawk, without any disconnects. I guess the city felt that it was a service that people needed, and it did serve a useful purpose, and that the price didn't seem to them to be out of line, even though it was an enormous increase at that point in time. We had at least 85% penetration, although we actually didn't know. An interesting sidelight is when we tried to figure out what penetration we had, we didn't have any good figures on how many homes there were, so it looked like we had about 105%. It later developed when we had better figures on homes passed, that it had been in the 85‑90% area, so we had virtually everybody.
PAGLIN: And as you say, there was no other way of getting television.
TAYLOR: There was no other way of getting television. The translator came in, subsequently to provide one channel of service, and later it became a satellite station, and finally is now a local station. But at this time that competition wasn't there.
PAGLIN: And that was in the late 50's, early 60's?
TAYLOR: Oh, that was probably in the mid 60's.
PAGLIN: Now, would you say, was this a situation that was fairly typical in the mountain west, in the mountain region in the West?
TAYLOR: Well, probably in Montana, but there were a limited number of systems in Montana, and they were unregulated. I don't know that any of them used quite as bald a method of raising their rate as we did. But they operated without regulation in Montana. But in Washington State, however, and Idaho, I'm not too sure about Wyoming, but probably in Wyoming, they all did have franchises. Although the franchises were really just a little bit more than a business license, they didn't have any terms in it other than to protect the city against financial damage. They were not related to customer service or any of those other features that began to come in later. I think that the monopoly nature of the thing, the kind of thing we did in Kalispell, and perhaps other customer complaints to the city, may have triggered some ideas that they should put more into their franchise, have more restrictive, more regulatory requirements in their franchises, and so they began to do that.
At this time, we were in an unserved area, where there was no TV station. We were beginning to get into places where there was a TV station, other systems, not TAYLOR: and his associates, but other systems around the country were beginning to operate where there was one TV station, and found that that was a profitable way to go, so then they began to go where there were two TV stations. Pretty soon they were looking at three station markets, "cherry picker" markets, on the theory that the reception was not always that good, that they could bring in programming from a distant station, better than the people in the community could do it for themselves, and therefore that they would have something to sell. This was the theory upon which the 1972 rules were built, that distant signals were the thing that would make it work in three stations markets. So a very elaborate set of rules about distant signals were included based on the size of the market, very complex, and I'm sure you remember all of those.
We get into the 1974‑75 period when the national economy took a slump, and we'd about built all the markets where there was a problem; "cherry picker" markets always had some network programs that you couldn't receive, and of course in two station markets there was always one missing network station that you could bring in, but those markets had all been built. So you were looking at the major markets that already had the full complement of television service, and they were hard to sell, because even the distant signals that you might bring in by microwave or however, were just more of the same. In many cases, even the independent programming was syndicated, but there was a real doubt as to whether this would fly in the major urban areas, and so the investment community was slow. The economy was slow, and on top of that our principal contact was the investment community. I'm talking of the industry now, the principal contact, and the spokesman for the industry was Irving Kahn. He was a very effective spokesman, and representative to the investment community, particularly in New York.
But he'd gotten himself involved in the Johnstown matter, and for several years he was under trial of various kinds, appeal, and one thing led to another, and finally he had to go to jail. So when our principal spokesman went to jail, and our economy was sour, and there weren't any new places to build that were what we called conventional, which were underserved areas, the whole industry took a slump. A very serious slump. It was then that we felt that pay TV was likely to be our salvation. At that time pay TV meant tape recorders, tape play machines. You'd get movies on tape, and you'd play them on a channel. Time magazine and Home Box Office had the foresight to look at the possibility of satellite transmission. We'd talked about it, in engineering meetings, but I'm not sure that any of us really had any confidence that it would happen within a reasonable price range. But certainly when HBO put on that demonstration in Florida and Mississippi...
PAGLIN: When was that?
TAYLOR: 1975. That proved that there was something to it. From then on, the industry began to boom, because now people could see that they could build the urban markets, other than Manhattan. Manhattan has always been a typical 'conventional' market, because the reception has been so poor. Empire State Building signals bounced all over the place. You had terrible signals in Manhattan. Therefore it was a classical system, you couldn't call it an urban market system. But the other places, well, Boston was later coming, but Philadelphia certainly started their talk, they didn't actually produce anything, just barely now they're beginning to produce.
PAGLIN: Well we skipped ahead a little. Now at this same time, or about this time, the FCC of course, started getting involved early in the game in terms of how they would regulate the franchising criteria and policy of the municipalities. You remember they sent out a Report and Order. Were you familiar with that?
TAYLOR: Yes, at this point it kind of blurs together chronologically. I can't remember what happened when. But in the early days, in the 50's, to probably the mid 60's, the FCC position was, "We don't want to regulate it, we don't need to regulate it. There isn't any point, we want to stay out of it." They wanted to consistently stay out of it. They were forced by Carter Mountain to get into the microwave authorization, which they did, because the court said so. But there was beginning to be a feeling pushed, I think primarily pushed by the broadcaster opposition, the Craneys and the Bill Groves, the Pengras, and the Putnams and the whole bunch of broadcasters who didn't really like this thing coming along. NAB felt that it was pay TV, and that it was pay TV coming in the back door that would destroy free TV. That argument seems a little funny today, but even to NAB I guess it seems a little funny, but I guess that they could honestly say "I told you so". I think they were probably right to be concerned about it.
PAGLIN: So the course of development was different then, the kinds of fears that NAB as an industry representative had at the time. In other words, the way it developed was not exactly because of things they worried about.
TAYLOR: Well, we have pay TV. It's on cable and there isn't pay TV on broadcast. That was attempted with STV in the 60's. They authorized it with some rather severe restrictions, and then finally removed the restrictions. It still didn't fly, for, as we know now, some pretty good reasons. It was just not a viable broadcast type service, at least not with the technology they were using at the time. There may be technologies that would work, but not in the way that they were doing it. So yes, pay TV has come along, and cable is what's made it possible. Milt Shapp predicted that. He said, "You can't protect it when you put it out over the air, but put it out on the cable and you can protect it." It was not quite as easy to do as Milt Shapp thought it was in those days, but yes, I think and in some ways I feel, that perhaps what's happening to the three networks is due to the proliferation of alternative programming. This is exactly what they used to say, they called it fragmenting. They did all kinds of funny things with the English grammar, but fragmenting the viewing audience is what they feared. I think, to some extent, that this is exactly what's been happening as a result of the technology. Well, it's not only cable, but it's through the satellites going to the cable. And you've got VCR's, you've got MMDS, for a while we had STV, but that's gone now, and the DBS which at this point is de facto, not particularly authorized, (direct broadcast from satellites). The backyard dish is an easy way of saying it; they exist, we call it de facto DBS. So that fragmenting of the audience has really happened, and it was I think bound to happen. You couldn't stop it any more than King Canute could stop the tides.
PAGLIN: Getting back to the FCC's role. The thrust of the FCC'S role here, initially, was protection, as they saw it, and as the court ultimately upheld it. They saw it as their mandate to protect over‑the‑air broadcasting, local broadcast service, local stations and they saw cable as being a complement of broadcasting. The Southwestern Case gave them the jurisdiction. Now in their activities in terms of franchising criteria by municipalities, and again the FCC's attitude was, we will set down general criteria, we will set minima and maxima, and it's up to the city to regulate it. That is to say, you have to go to the city to get a franchise, right? And it got to be certified that they have observed certain of our procedural and substantive criteria. How did you feel, or did you have an opinion about whether this was, in fact, a proper role for the federal government as contrasted to a strictly local jurisdictional problem?
TAYLOR: Well, first of all, I think the Commission saw its mandate a little broader than just protecting the broadcaster, their mandate was to protect the public's right to receive television. There were places where you couldn't get it without the cable, and so they were in the position, they couldn't just regulate cable out of existence. They had to leave cable in a position to serve the public that could not receive television otherwise, or even receive the choice of television that they would like to have. So that part of their mandate really went toward making the cable go. But they were trying to do it in such a way that it would be ancillary to the broadcast service.
They also recognized, I think, that cable television extended the viewing range of local broadcast stations, and therefore actually was an advantage to broadcasters, although most of them wouldn't admit it at the time. Obviously some of them did, we had the Leonard Reinsches and the Dick Shaftos and a number of broadcasters. For a while Ward Quaal at WGN in Chicago saw the value of extending its signal through the medium of cable, and also saw it as a means of protecting their investment in case cable became a bigger thing than broadcasting. It was a good business judgment. The AMST (Association for Maximum Service Television) was probably the most strenuous opponent of all and their view was to regulate this upstart very, very severely. Technically, they made the argument that they wanted to regulate us the way broadcasters were regulated, but they went far more than the regulation of broadcasting. I had an opportunity to examine AMST's filings at the FCC repeatedly, and it's really Howard Head who had done it for AMST. This is how I got to know Howard Head. It was in the process of discussing these technical standards, and I think Howard and I saw pretty much eye‑to‑eye within the limits of our own biases, which were obvious biases that we both recognized and respected.
End of Tape 5, Side A
TAYLOR: One thing in the early regulations by the FCC, Sol Taishoff kept insisting that the way to regulate this cable industry was with the retransmission consent.
PAGLIN: Sol Taishoff?
TAYLOR: Sol Taishoff, Broadcasting Magazine. He editorialized on this over, and over, and over again. Rosel Hyde picked up the idea, a close friend of Sol's as you probably recall, and he felt that that was, without question, the way to regulate this industry without regulating it out of business. One of the most remarkable things that I have seen, I think is when he put out, when he was Chairman, and the rules were put out, I don't remember the date now but it was certainly mid 60's, '67, '69.
PAGLIN: The First Report and Order?
TAYLOR: No, I think this was the second.
PAGLIN: That would be '64, '63, '64.
TAYLOR: Well, was there something later than that, before the '72?
PAGLIN: Well that was the First Report and Order, the Second Report and Order was around '65, I think.
TAYLOR: That sounds about right. When was Rosel chairman?
PAGLIN: Well, he was chairman from '66. Well, he was chairman before then, but in this period, he was chairman from when I came back as executive director. Chairman Bill Henry left, and Rosel was appointed by LBJ in late '66, and was chairman until Dean Burch came in in '70.
TAYLOR: In '70, okay. Then it was in that period, when Rosel was chairman, that another set of proposed rules, or draft rules came out, and these were based heavily on the retransmission consent theory. There was a press conference held to explain these rules, and I'm convinced from the reports that came from that meeting that for the first time in his life, Rosel Hyde saw what retransmission consent really meant; that it meant allowing the broadcasters to control their competition. A broadcaster could deny retransmission consent to a cable operator in order to put him out of business. I just don't think that he understood that until that very date, that he was at the hearing. Because the questions were put to him from the floor, and he just seemed stunned by this thought that had not ever occurred to him. I'm sure people had told him about it, but it just didn't sink in till it hit him that one day.
TAYLOR: It was a remarkable day. Retransmission consent never had any real merit except from that point of view, and when they tried retransmission consent on translators, for example, it was required. I saw some of the letters that were written by the stations, and they would say, "To the extent that we have the authority to do so, we hereby grant consent." Well, they didn't have any authority to do so, because they were restricted under contract with the program owners and suppliers. Consequently the retransmission consent didn't have any meaning. The stations gave it. They fulfilled their obligation. They had no reason for not allowing the translators to function. They weren't competing with them; they were generally extending their service area. But broadcasters worried that cable would compete. So there was a real threat that broadcasters would use that consent, and the denial of that consent, to prevent the cable from operating. This was the basis on which, incidentally, Senator Pastore took up the cable operator's case in the Senate Bill 2653 in the early 60's. He could just not see that letting one industry control its competition in this way was equitable.
PAGLIN: I'm speculating. I've worked with Rosel Hyde for many years, but there were things that he was not particularly attentive about.
TAYLOR: That's probably what it was, Sol Taishoff had told him this is the way to do it and he respected Sol...
PAGLIN: Also, you see, you know Rosel Hyde grew up with the Act. He worked for the Federal Radio Commission in 1927; he was a clerk, and he went right on up the ladder. In the 1927 act, and then in the 1934 act, one of the central critical provisions in the Communications Act scheme was section 325, which in broadcasting, requires the consent of the originating broadcast station before you can rebroadcast. Now you can see in his mind, he was raised in broadcasting for forty years before then, and to him this was, well, this was the natural thing. I mean the guy who has the program who pays for it, naturally, you have to get his consent. And I will bet you, knowing the way Rosel's mind thinks that to him that was it. Then the implications of it, as you point out, were not realized by him, the full implications, until it came out in this oral argument. Was this a rule making proceeding, a hearing before the Commission? I think that's what it was.
TAYLOR: No, this was just a press conference about the rules that were proposed, and then the questions from the people who were interested, probably NCTA people and so on, key operators.
PAGLIN: That's very interesting.
TAYLOR: They finally got out of this retransmission consent being the easy solution to all the problems. Then they had to deal with the whole ball game, and the logical thing that I think the AMST was asking for is licensing, get them under your direct thumb so that you can control them. They looked at the possibility of comparative hearings, and they didn't want any of that stuff. Let the cities do it, they're doing that stuff now, let them have it. So, I think that's probably how they got to the two step regulatory plan. They'd just as soon let the cities handle the bulk of this, because it involved customers, and customer rates, and they didn't want to get into that. They have enough trouble with common carrier rates, but they agreed with Strat Smith after he had left the Commission. Curious thing is that Strat supported the common carrier status when he was with the Commission, and later, of course, he changed. His later position was that it was not a common carrier and I guess the Commission basically agreed with that, that they didn't want to see it as a common carrier. But how else could they regulate all these things? So, I think as they looked at it, it was just so much easier to leave it in the hands of the local governments.
PAGLIN: And would you agree to that, provided that there were certain fairness in the procedures?
TAYLOR: I saw a franchise proposal that came out of Bill Daniels' office, for example, that had a very reasonable rate percentage of gross for the city, up to the point where he thought he was going to have any customers. Then beyond that number of customers the rate began to escalate very rapidly. He was giving 50% of his gross over a certain amount that he thought he'd never get. He forgot about inflation and city growth, I think. There were some exorbitant franchise fees proposed, usually phony. They were on the basis of gross revenue that we'd never have, or populations that we'd never have, subscribers we'd never have. But the operators felt that the FCC had to step in, and put some ceiling on this. Besides they felt, and I think Chairman Dean Burch probably had something to do with this, or at least his staff, that if cable television is nothing but an entertainment medium, it isn't worth our fooling with. It's only if it can do some other things that have value in education, or business transactions, or other purposes, that it has values. So to his administration's way of thinking, I don't know whether it was he or someone else that came up with it, the idea that money paid to the city should not be in lieu of taxes, but should be to provide a service to the public by enabling them to set up their own studios, and their own facilities, and one thing and another. Pay for the staff that you need to run a studio, local originations in other words. Probably a very sound policy, but this is where the 3% and the 5% came in that the extra amount could be levied, if it were clearly being used solely to provide programming by the city. Even the 3% was only to be administrative costs of exercising their police powers. These franchise fees were not to be in lieu of taxes, because they could see the cities just levying all kinds of unconscionable taxes. Dean Burch, now whether it was he or some of his people that pushed him into it, but at any rate, he felt that the administration felt that, these other services, and that's where the access came in, public access, access for the government, access for education. They also felt that once you have this system in as a kind of monopoly that you should therefore be required to lease space on your facility to other people who want to use it and use it for generating revenues of their own.
That ran into a funny roadblock, when a company in California, that provided a pay TV service, looked like it was going to be required to let a competing pay TV service lease its own channels. Raised some very touchy questions, and the channel leasing, of course, has never really happened. There is still some talk about using it in various ways but it's never really happened. You know what happened to the access channels? They got dealt with by our mutual friend, Midwest Video, George Morrel.
PAGLIN: Yeah, George Morrel. That went up to the Supreme Court, and the Supreme Court said cable is not a common carrier, and you can't make them do this. So then what we have here, Archer, is the fact that, as this service matured, and as it showed its role in service to the public, there then came a time when the FCC decided that cable also needed a certain degree of protection, such as you've been describing.
TAYLOR: Yes, I think that's right. That's probably right. They felt, I guess, that the certification procedure would give them the ability to enforce these rules as far as the cities were concerned. As it turned out it was really impractical. We had a client in Longview, Washington, who wanted to get the franchise in Vancouver, Washington, but he was having trouble in Longview. They were raising their franchise fee to 8%, I think. But he really couldn't take it to the FCC as a complaint, because the city would penalize him even worse in other ways, because now, he's a bad citizen. He was up for renewal, and they could have denied his renewal if he didn't agree to this. He just felt that he couldn't go to the FCC. The enforcement power depended on the operator taking the complaint to the FCC, and he was under such pressure from the cities that he couldn't do that. So the certification procedure was not really effective.
PAGLIN: So the city wouldn't give him the certification.
TAYLOR: Well, it was the FCC that gives the certification you see.
PAGLIN: In order to be certified by the FCC you had to bring to them in the application for certification, that all of these procedures etc. were observed.
TAYLOR: Yes, but the certification didn't have to be renewed over time. So you'd bring in the certification that the procedures had lived up to, but if the city raised the franchise fee unduly, what you feel is unduly, and there wasn't a mechanism for bringing this up that didn't put you in bad shape with the city that was doing the other regulating.
PAGLIN: So is that one of the reasons it was dropped finally you think?
TAYLOR: I'm not sure. I think it turned out to be an exercise in bureaucratic effort that didn't have any visible results, and consequently they decided probably in the beginning of the deregulatory period to drop it; it wasn't serving a useful purpose. I think it was unfortunate that they also dropped the requirement to file statistical information. The Commission had dropped the requirement for statistical reports, annual reports, number of subscribers, rates, and so on. We do not have an official data‑gathering body.
PAGLIN: The NCTA doesn't do any of that?
TAYLOR: The NCTA doesn't do it, Al Warren of Television Digest is probably the best collector.
PAGLIN: Television Digest the publication?
TAYLOR: Yes. He sends out, for his annual Fact Book, he send out questionnaires to all operators that he can identify and locate. But the questionnaire is only as good as the person who answers it. He gets a remarkable return on these things. I recall a time when my own local manager in Kalispell reported that we had 1,900 subscribers for about 5 years. We were up to 3,500, 4,000. I said to him, "How come you didn't send the figures?" and he said, "I don't want them to know how many subscribers we have." So he just kept reporting the flat rate. If our guy did it, I'm sure there were others out there who were not reporting accurately their figures. In fact, Bob Magness one time told me that he didn't want to publish his official figures, he gave just top of the head figures. One of the reasons for that is if you know our rate, and you know our subscriber count, then you know what our gross revenue is. Most businessmen like to conceal their gross revenue. But, at any rate, Al Warren does a remarkable job. You know it doesn't have the accuracy it would have if it were official. Now he used to use the Form 325s, that were filed under orders from the government, which presumably would be more accurate. Although even those are not much better than the guy who fills them out.
PAGLIN: Except they have the usual admonition at the bottom, for filling out a federal form about accuracy.
TAYLOR: There is a little more pressure, a little more status to them than a questionnaire.
PAGLIN: Those reports, as I remember, the individual reports, were they held confidential? Because I know the Commission published the overall data, but like with the broadcast annual reports, the financial reports I mean, were confidential. You have to make a specific showing before you could see them.
TAYLOR: Yeah, I think the statistical reports were not confidential, because Al used to get them, and use them in his directory of cable systems. He used both, he used the official documents, and the questionnaires that he sent out, in combination, checking them against each other.
PAGLIN: We covered your problems in building the early system, so we won't go over that again, and you've been telling us about the problems with some of the local agencies...
TAYLOR: You have a note in the outline on competition for franchises, and that's a whole field of interest that happened really after I came with Martin Malarkey. Do you want to discuss that at this time?
PAGLIN: Yeah, I'd like very much to have your views. I remember you telling me about a particular incident in an earlier session.
TAYLOR: That earlier incident was a case of franchise application and processing. I remembered the name, it was Salinas, California, and John Cohan was the broadcaster there. He wanted to kill this cable franchise. So, he called on Skinny Reardon, it's a shame to call him by his nickname, but I'd have to research to find out what his real name was. We always called him Skinny Reardon. We called him to come down and testify because Reardon was the guy who claimed that our cable system in Kalispell was the one that put his television station out of business. So he sent a wire to Cohan saying that he'd come and testify, but he said, "I will say that cable and broadcasting can live together."
What I was thinking about was the competition for franchises that began, the real heavy competition, began probably after the satellite demonstration that HBO put on. People began to realize that pay television was here for sure, and was going to be the lifeblood of cable television. I'm not quite sure of the timing, but I think we probably did the franchise in Henrico County, Virginia, down in suburban Richmond, and one in Rochester, New York, probably. Both of these we worked for the franchising authority. Probably these were before, what I considered, the first real entry we made into the franchising competition. Marvin Shapiro of Group W, who was Vice President I think, at the time, called me, and wondered if we would help him with the franchise application on Group W's behalf in Nashville, Tennessee. The process was already in progress. Cox had been there for two years laying groundwork, and Viacom had been there for a couple of years, maybe not quite as long as Cox laying groundwork...
PAGLIN: This was in Nashville?
TAYLOR: This was in Nashville, and there were a couple of other applicants who were perhaps of lesser status. Storer I think was one of them. But Cox and Viacom were the ones we knew who had spent a lot of time romancing educators, city people, and so on. But Group W wanted to get in in a big way. They had a small group of systems in Georgia. Primarily, Tallahassee, Florida, was their big system.
TAYLOR: Valdosta, Dublin...
PAGLIN: I handled the first microwave application for Group W; it wasn't Group W then, it was Westinghouse in 1965.
TAYLOR: Well actually this was Westinghouse; Don McGannon and Marv Shapiro was his assistant, and so we went in...
PAGLIN: John Lane, their attorney, right, he called me in to work with him on it, when I was in private practice.
TAYLOR: Right, John Lane was the attorney; he was right next door to us.
PAGLIN: Did they even know anything about cable?
TAYLOR: Well, they had this group down in Georgia and Florida. That was all they knew, and by the time they went for Nashville, they had to play heavily on their very limited experience. It was a knock‑down drag out. We worked hard on it.
PAGLIN: This was '70 something?
TAYLOR: I would say it was probably about '78. Well, there are a lot of interesting stories out of it, but I don't think it's necessary to put them all in. At any rate, Group W finally won fifth position out of six applicants, and the sixth was so bad that it wasn't really any great victory. But primarily what hurt them was, that here you are Westinghouse, I think they claimed ten billion dollar cash flow or something, an enormous cash flow, the ability to build Nashville out of petty cash and here this great big company was now going into cable TV. They'd been in it for ten years, and hadn't done a thing with it. They just had these little small systems that were a wart on a pickle, except for Tallahassee. Well, they tried to build Tallahassee and they wanted to get a southerner in, and so they got Bill Keller, the general manager of the system, who had been the city councilman in Valdosta when the grant was made to Westinghouse to run the system. Well, he now had the job of general manager of the properties. He came into the hearing with a full, beautiful soft, southern accent, you know, it can be a beautiful accent, and talking to the people in kind of a colloquial type language, about you know, just a little guy building the system, and he said, "Nashville was really nothing but four Tallahassees." And boy, that was just the wrong thing to say. That probably really lost the franchise. Nothing but four Tallahassees? He was trying to show that he knew how to run these things, that Westinghouse did know how to run Tallahassee, and that Nashville is not all that much more difficult. That killed him.
I had protested, the City had required an institutional network, and I didn't like the idea of being required to build one of these things. We had talked to the educators, and the educators said, "Look, we don't have any money. We can't even pay our teachers, we can't get money to use anything like this institutional network. Sure it's a nice idea, and it's got a lot of nice features, but we just simply aren't going to get the budget to operate it." Then we talked to other people and got the same answer. So why should we be required to build an institutional network is what we argued.
I made a very nice case in our franchise application that we would built it; comply with the requirements, as soon as we have a bona fide order from bona fide customers. Well, that ran into trouble, and the council was objecting to it and so on, and finally one night at dinner, Marv Shapiro asked me, "Well, just how much is that institutional network going to cost?" I said, "Well, I figured out it was about $750,000." that it would take us to build this thing. And he said, "You mean we're going to have a $40 million project here, and we're going to lose it for unwillingness to spend $750,000?" So he went into the hearing then and personally he said, "I will, here and now, commit Westinghouse to build it regardless of whether we have customers or not." But the efforts were to no avail. Viacom had just done too much homework, and Cox was out of it because at that time they were going to be acquired by, or purchased which ever way it went, by General Electric. GE had a TV station so they couldn't have the franchise, because they would then be, the TV would be in conflict under group ownership rules. So Cox had withdrawn from the contest. They probably were better prepared even than Viacom, but Viacom was very well prepared, they did a good job, and they got the grant. Westinghouse didn't. Well then Marv Shapiro wanted to get Westinghouse into the business, by this time McGannon had retired; McGannon didn't like cable at all, and that's another story.
PAGLIN: Well he's a broadcaster, and he became ill.
TAYLOR: But the man, oh what's his name that became president? I think he's gone now.
PAGLIN: Was he the president of broadcasting? Oh yeah, I know, you're talking about Daniel L. Ritchie. He succeeded Don McGannon.
TAYLOR: Well he had been under McGannon, and when he superseded McGannon, and it was known that McGannon was retiring, and that he would supersede, that was why Marvin went into the business, because he knew that we could go after it, and that this man would not only support him but encourage him, which he did. So after they lost Nashville, then Shapiro came to us to help him find systems to buy. He said, "We've decided that franchising is not the way we can get into this business, the way to get in is acquisitions." So we did some negotiating and finding and we put them together with Continental.
PAGLIN: Who owned it... not Gus Hauser?
TAYLOR: No, Bud... my memory is...
PAGLIN: Owner of Continental, Hostetter, right?
TAYLOR: Yes, the owner of Continental. We got them together with Continental, and got down to the point where they needed to have the financial statements, so we could see what was actually going on and Hostetter, Bud Hostetter and Irv Grosbeak wouldn't let the consultant, Malarkey‑Taylor get that close to their books. So finally Shapiro said, "Well, we'll do it ourselves. We'd like your expertise to help us, but, since they won't let you get in that close to their books, we'll have to do it ourselves." Well they did. And the whole thing just died, nothing happened. All of a sudden comes the announcement in the press that Westinghouse has acquired TelePrompTer, which at that time was the biggest MSO in the business, you know it really startled us. When I saw Marv later, I said, "When you say you're going to think big, you really do think big, don't you?"
PAGLIN: Did they use you for that? Or did it come as a surprise?
TAYLOR: No, no, it came as a total surprise to us. But later, I was talking with Marvin, and this was after he had left, and was in consulting, and he said, "You know, sometimes an acquisition is just too big to digest." And that was what, he felt that was. It was too big for them to digest. Big as Westinghouse Electric is, it still couldn't find, and Group W is just one company, just one corporation, just Westinghouse. The others are all just doing business as subsidiaries. All have their organization, but legally, they are all one corporation. So apparently it was just too much.
PAGLIN: Very interesting, the history. Again in the form of footnote: the reason why Westinghouse had a totally separate subsidiary, with totally independent management for their communications or broadcasting operation, as contrasted to say, GE, which had an up the line, line of authority right up to the top, goes back to the 60's when both of them got into trouble with the Justice Department in an anti‑trust case involving turbine monopolization, where some guys went to jail. The Commission had a big proceeding because the directors and officers were now convicted of anti‑trust violations. The question was whether the parties were qualified to hold broadcast licenses in view of the anti-trust convictions. And Westinghouse showed that it had a totally autonomous operation, which it did. GE did not. GE had broadcast in Schenectady, I remember at the time. So Westinghouse was allowed to continue, as it was. The theory was that the people with the turbines that had done all these things to the government, and the rest of the industry wouldn't know a transmitter if they saw one and had nothing to do with broadcast operations. So, they got cleared on that basis with the understanding that Don McGannon at the time, would continue with autonomous broadcast operation, having nothing to do with the parent company. GE was required by the Commission to set up a separate, autonomous unit to run its broadcasting, which was removed from the parent company.
TAYLOR: That was probably the GE organization that was going to merge with Cox. Probably was.
PAGLIN: Probably so, and it's interesting how these things have a way of continuing into history. What other experiences did you have?
TAYLOR: Competition for franchises, there is an interesting aspect to this, I think. We were involved in several and I'm not sure that any of the others after Nashville need to be discussed in particular. Just for your interest, we did a franchise in Vancouver, Washington, so I spent some time trying to learn... that was just about the time that Mt. St. Helen blew her stack, too.
PAGLIN: Oh really, that recent?
TAYLOR: In fact, one meeting we were supposed to have up there was oh, just a week or two after that first eruption. And frankly, I was kind of afraid to go up there, because I had seen the stories, and heard the stories about dust on the highways, clogging your car up, and you get stalled out on the highway, and this was before cellular telephones, so you didn't have any way of communicating, and I just didn't like the idea, and so we met out in California instead. But that's an aside.
The franchise competition got to be so rugged, and there were so many promises, people were promising the moon, you know, blue cheese, and everything else in their franchise petitions. And it got so bad that Tom Wheeler, NCTA, who was then president, came over and spent two or three hours with most of us at Malarkey‑Taylor. I think there were about four of us probably who were deeply involved in this work. Discussing, what we could do about this "over promising", this "over competition". We actually concluded that there's nothing we could do about it. As long as it's competitive, you cannot expect an applicant to pull in his horns, while he's making a competitive pitch, because the other side will pitch for the higher. Looking at a city council, they are not knowledgeable on this, and they have to live with their constituents. When Viacom says we'll do so and so, and the other guy says, well, we're not going to do all of that, because that isn't practical. The constituents are going to see, here's the better "mousetrap". But we're not going to do it because it's too costly, and they know how to do this, and make it work. Well, the truth is they don't and they're going to talk their way out of it later.
PAGLIN: Didn't the cities begin to retain like Malarkey‑Taylor and other consultants, to assist them in the whole franchising process?
TAYLOR: Yes, I think the first of those was the CTIC, The Cable Television Information Center, originally a Ford sponsored organization to assist the cities in connection with cable television. They, then, became consultants to cities. But some of us felt there was a need for other counsel. Particularly when things got slow for consultants in the mid 70's, we began to look to the cities, because we could see things coming. So we went after the cities directly. We had been called in by cities prior to this too, we were called by Montgomery County, in Maryland...
PAGLIN: Oh yeah, I remember this one, it was about 8 years ago now, wasn't it?
TAYLOR: Yeah, it was quite a while ago, and we were invited to go to Tucson, this probably would have been earlier than that, probably '75 maybe. Interesting sidelight, in Tucson, they asked everybody who came down for an interview, and Martin went down, "Do you own any stocks in any of the potential applicants of this franchise?" Well, we had religiously bought 8 or 10 shares of stock in each of the publicly held companies in order to get their annual reports, so we could keep track of what was going on. So Martin disclosed that and that immediately disqualified us. We had stock in people that might become an applicant, Martin came home and sold all the stock immediately.
This is another problem we had in Montgomery County when consulting for the franchise that was eventually awarded to United. The staff people in Montgomery County wanted us because we had worked with them before on a fairly extensive study. They liked us, they liked our approach to things, but the county, I guess, had required that they put in there, 'no connection whatsoever with any of the potential applicants'. We still had connections through having worked for them, virtually all of the top applicants, we couldn't hold ourselves to the standard that they had in their RFP so we didn't even bid on it. Well, a fellow in California actually got the consulting grant for Montgomery County, did quite a bit of work. He was a former telephone consultant, and could extend his former telecommunications expertise in this field, and became a fairly, well he was a competent consultant, wasn't as large as we were, didn't have the background in cable that we'd had, but he was independent of any of the operators, so he became a second source for CTIC.
Yes, we worked for a good many cities, probably the most interesting one was the City of Chicago that finally hired us after considerable discussion. I told Martin, when we decided to accept the appointment, I said, "This will go to a lawsuit just as sure as the day is long. Going to go into litigation before it's over with." Because we knew that the applicants were going to hit hard and heavy in Chicago, and the trouble with these things is that the grant goes to one applicant, and there are two or three that fail. The ones that fail are the ones that litigate.
PAGLIN: Same in broadcasting.
TAYLOR: And same in broadcasting. So I just knew that Chicago being the way it works and so on, that we were going to be sued. It turns out we didn't; it went beautifully. Everything went fine, and I give a lot of the credit to Ed Vrdolyak, fast Eddie. He managed the whole thing and gave us the free hand, he respected our judgments, he even told Mayor Byrne one time, who wanted to go against our judgment, that you'd better go by the consultants' judgment.
PAGLIN: Who ultimately got the grant?
TAYLOR: In that case this was Area One, which was the gold coast of Chicago, and it was awarded to Cablevision. Chuck Dolan had, by far, the best application, there wasn't any question from our point of view, it was the best application. There were only two applicants for the area, but Byrne had apparently made some kind of commitment to the other applicant.
PAGLIN: Who was the other one, you know?
TAYLOR: I can't recall at this time, and I don't think I really want to.
PAGLIN: Yeah, that's all right.
TAYLOR: But it was just not a good application; even though they did have the political clout, it was not a good application. We were screened from the political crowd. We didn't know about the political situation, fortunately, and we made our judgment independently of that. As it turns out, Cablevision didn't want it anyway, they had hoped to get one that went to Group W. Group W did an excellent job, they had a very good application.
PAGLIN: So there were some interesting contests. Do you remember I asked you, Archer, that when we get ready with the transcripts, as I mentioned that they'll be coming forward, and you are going to keep in mind, to try to find, when we were talking about the technical problems, some of your technical papers, and things like that, to go along with these transcripts, also with Martin Malarkey's, it'll be kind of a package.
TAYLOR: The papers or just the titles?
PAGLIN: Well, if you have copies of the papers then that'll be good, because it's going to be a museum at Penn State you see, and we're going to have artifacts, and documentary stuff, and things like that.
End of Tape 5, Side B
TAYLOR: Well let me ask you another question along this line, for about almost three years now, I've been publishing a monthly column in CED magazine, I have copies of all of those columns, do you want all of those, that'll be a clutter of paper?
PAGLIN: Well, I could ask them at Penn State whether they would like to have them, and chances are they might, I don't know.
TAYLOR: As in all columns, sometimes they say something, and sometimes they're just words.
PAGLIN: Yeah, but it's still information material. Some student or researcher and so on who wants to know the kinds of things that have developed in the industry may find them useful.
TAYLOR: All right, I'll put that together.
PAGLIN: All right. Now you've talked about your own CATV systems and when you sold them and all, I don't remember exactly when you sold them.
TAYLOR: Well, we sold in 1968.
PAGLIN: Sold all of them in 1968?
TAYLOR: Well, see they're all in a package, they're all together up there out in Kalispell. We sold the whole package to H&B American, which then became TelePrompTer, which then became Group W, and they are now TCI. But this was shortly after I had joined with Martin that we decided to sell, and we used this fly‑by‑night firm of Malarkey‑Taylor to do the investigation appraisal, and put out notices, and so on.
PAGLIN: Fly‑by‑night. I remember earlier it was fly‑by‑night. So shall we conclude today's session with your point of view, how you first met Marty, where and when, how your association began, and how Malarkey‑Taylor started.
TAYLOR: Sure. Of course, my knowledge of Martin Malarkey goes back to my first knowledge of an NCTA, because he was the head of it, and that probably was about the time that we started Northwest Video, in other words, about 1953. Since I was injured in 1953, and 1954 was kind of a dead period (in hibernation), I first actually physically met him probably at one of the NCTA conventions that I went to in New York at the Park Sheraton. That was about '55 maybe, '56, '55, probably. So, I met him personally - at that time he was president. But of course, we had not any real connections, except over that deal that Martin, Bill Daniels, and Ed Craney had been trying to put together, Home Theater, in which Ed Craney had ordered my partner, Norm Penwell, to take the stations off our cable system. Later, and this would have been probably in 1963, sometime in '63, I think it was probably the year that I was Vice Chairman of the NCTA, we had the job of firing the, then president of the NCTA, who was a paid president. First paid president we had, and he turned out to be an alcoholic, and there were some other problems with him.
PAGLIN: It wasn't Fred Thompson, was it?
TAYLOR: No, it wasn't Fred. He was never president. Bill Dalton. He hadn't known anything about cable television, he was brought in because of his experience, and expertise in the trade association administration, but he had some other problems. Fred Stevens was the chairman...
PAGLIN: Oh, that's who I meant, Fred Stevenson.
TAYLOR: I was the Vice Chairman, and it fell to our lot to create the vacancy. Well then the question was, I was on the selection committee, and it was a question of, you know, who are we going to replace him with. The Barcos were pushing a fellow from Pittsburgh, Don Taverner, and there were some other applicants. I was talking with Al Dougherty one time about the situation, I knew Al quite well by that time. He had handled my wife's legal case, and he was lobbyist and counsel for the State Association in which I was Secretary/Treasurer. So, I was talking with him about this situation, and it developed that he might be interested in applying for it. So I began to set up the framework in which I presented Al as the candidate, and I don't know how it happened, but I think Martin was the one that somewhere along the line suggested that I should be the candidate for the chairman. First of all, it seemed outlandish to me. Secondly, I really thought Al Dougherty would make a better one. But I couldn't get anywhere with them, the thing was he wasn't known, they didn't know him, they did know me. Well, it seemed a little farfetched to me, but it came at a time when I realized my business in Montana as a consultant, one‑man‑shop free lance, was more than I could handle alone. When I was out of the office, there wasn't anybody in the office. I was going to have to do either one of two things, either turn down business, or bring in staff,
and I just was afraid to handle staff by myself. It wasn't that big a business, and there was just too much up's and down's to it for me to assume the responsibility for a staff.
I did think that I might have a partner, and I went to my old friend Norm Penwell, and he was at that time living in Tucson, Arizona, and he said well, he didn't want to leave Tucson, you can come down here, and we'll set up business in Tucson. He had some other terms that I couldn't tolerate, so then I went to George Frese in Wenatchee, Washington, who was a respected one man shop like I was, working out of Wenatchee, Washington, and he liked Wenatchee. He said we can come over here to Wenatchee, and we'd be fine, but he wasn't coming over here to Missoula. So I was at kind of loose ends, my wife is a native of Arlington, Virginia, and her family are all around here, and the idea of coming back, if we're going to move anywhere outside of Missoula coming back to Washington would be the logical thing to do. So with that kind of in mind, I was a little bit at loose ends in Montana, the idea of coming back here to do a stint with the NCTA wasn't totally abhorrent, although I really didn't feel up to it. I didn't think I was the one that could do it, but several people seemed to think that I was, so I took their judgment.
About that time it became clear that Fred Ford was going to be available and was going to be a candidate, and there was no way I was going to be considered more acceptable than Fred Ford. In fact there was some opposition to me on grounds that I think were proper. I didn't have the aggressive lobbying approach that they thought was necessary and so on, and so I was never upset by the fact that I got turned down.
PAGLIN: This was the latter part of '64?
TAYLOR: That's correct. All of this kind of spread over into the '63‑'64 period. I had also been doing quite a little bit of consulting for clients in cable television. Almost always it was a feasibility study in which I had to make up financial pro formas, P&L pro formas, and then estimate how it was going to come out on the balance sheet, and boy I was beginning to get myself into stuff that I didn't really know what I was doing, because I'm not an accountant, I just don't have that background. While I was able to copy what some other people had done and make a fairly presentable showing, I just had the feeling that someday I'm going to get caught up on this. I'm going to be asked some embarrassing questions that I can't answer, or make a serious mistake and get someone in trouble, including me.
So, at the NCTA convention in 1964, it seems to me that it was in the Bellevue Hotel in Philadelphia, and I don't know how it came about, but I was sitting in the suite with Martin, and he asked me if I would be interested in joining with him in some work in Washington. Well, he was consulting at the time, he had, I guess, it was just Malarkey Associates, that's what he called it. He had an office in his home over on P Street, had a secretary that came in, Donna Fletcher, I think, so it just hit me right. I'd been thinking that coming to Washington wasn't a bad idea. I told him that, if it were Washington, I'd consider it, but if it were New York, no way.
PAGLIN: Well, he was here already?
TAYLOR: Yeah, he was here, I wasn't so sure of that at the time. So that seemed to make some sense.
PAGLIN: So what was it, was there a formal arrangement made the title of the company was changed, and how did it come about?
TAYLOR: Well, not at that time, I have to admit that this wasn't entirely clear to me when I agreed to join with him. I thought I was joining the consulting firm, but he had made a deal through Frank Marx over at ABC, who was a Vice President. Previously, Marty had been asked to go over to Paris, France, to look over a cable enterprise that ABC was interested in, and that Frank Marx was interested in. Then he had done another inquiry over in Ireland, again for ABC, but Marx had wanted to get ABC into cable. So ABC set up a subsidiary company called Cable Systems, Inc. and ABC owned 80% of it, and Martin owned 20% of it by a fairly nominal investment on both parts. But the objective of the company was to get ABC into cable television.
I was hired as the engineer to work with them in their evaluations, and whatever needed to be done, in connection with getting ABC into opportunities in cable television. Well, actually for me, it was consulting, but technically, it was a subsidiary of ABC, that I was working for. I'm not sure what the arrangement for my salary was, but I got my salary, and there was no difficulty. I presume that the funds went into Cable Systems, and Cable Systems paid my salary, but I'm not too clear on any of that. Well, I guess Martin has indicated what the history of that first year with ABC was. We found a Telesystems group which we evaluated thoroughly, and we presented it to the Executive Committee who like it, and took it to the Board, and the Board turned it down, it was too big. Although the thing was sold within a few months to Cox, at about a $3 million higher figure than we had been working with for ABC. So it shows that our judgment wasn't totally unsound. Well, then we went, and found the Kingston, New York property, which was smaller, a $2 million project, and got that one all together for presentation to the board. Martin got a call from Ed Ehrlich, counsel for ABC, I guess it was, or Leonard Goldenson, the president, one of the two, who advised him that they had just signed an agreement with ITT to merge, and the terms of the agreement were no acquisitions. So here we'd spent the better part of the year developing these two opportunities for ABC, and neither one of them materialized, and Martin just blew his stack. In order to get out of the company, subsidiary we had, and the contract that we had, ABC bought out the contract, and that was what got us into Malarkey‑Taylor.
Well, Malarkey‑Taylor was actually organized, legally, the first of January of 1966. I had come back here in November of '64 with Martin. My family came back, it was after Christmas I think in January of '65, and we worked for that year as ABC then finally organized Malarkey‑Taylor in January of '66. I wouldn't want to be on the witness stand and say it was January, the documents would show... but that's my recollection of it.
PAGLIN: But it's interesting that ABC, although I can remember Leonard Goldenson and Frank Marx's interest, I think they were probably the only network at the time that was showing that level of interest in cable.
TAYLOR: I think CBS had gone into Vancouver, British Columbia, in a very big way, but it was almost peripheral. It was run locally in Vancouver, and CBS didn't really have a big participation in it, as I recall, somehow it didn't ever seem to be CBS.
PAGLIN: But I was under the impression that ABC, Goldenson and Marx, were approaching it in an institutional way, and the others had not.
TAYLOR: Yes, I think that's probably true, it was not too far from that same time that NBC got into some action out in Seattle. I'm not too clear on how those dates all fit together. The interesting thing, and this goes back to some of the work I had done back in Montana, when I was with Paul Godley, our chief legal firm that we used then with all of our clients was Dow, Lohnes, and Albertson. When I got out to Montana, I needed a communications attorney, and it developed that Vernon Wilkinson was the attorney I worked with most, he was from the Okanogan Valley in Washington state, and he worked for Jessica Longston, who had a chain of radio stations in Washington, Oregon, and Montana. Because Jessica Longston had called me to help her on a project, I got to know Vernon, and I got to know Vernon quite well. I still consider him, oh I haven't seen him for a long time, but a very good friend. But Vernon, he needled me about cable. He and his partner, Jim McKenna as it turned out, were rabidly anti‑cable, and ABC was their client. So this is one of the strange things. Here was ABC, that we were working for trying to get into cable, and McKenna and Wilkinson arguing against it. Of course, Jerry Barnathan, he's with ABC, he might even be retired by now, but anyway, he also was just vividly, vigorously against cable television. He hated it with a purple passion. So I've always felt that between McKenna and Jerry, between them, I think they probably managed to queer that first deal. The second one went for obvious reasons, the ITT merger had nothing to do with whether you were for or against cable, and obviously when there's a merger in progress you don't have acquisitions, so that was understandable, it's just an unfortunate coincidence.
PAGLIN: Which then went down the drain anyway.
TAYLOR: It went down the drain anyway. You couldn't hold a deal like that together long enough to see whether it was going down the drain.
PAGLIN: Because the ABC‑ITT thing ran over a period of about what two years, for the Commission, and then the Justice Department got into it on an appeal, and then they walked away from it.
TAYLOR: That one was understandable, but the first one, the reasons they gave us were not always entirely convincing. I still feel that McKenna and Barnathan opposed it so badly. I think Frank Marx was probably the one most in favor of it, most wanted it to happen, and of course he's now retired.
PAGLIN: Well, Jim McKenna was a very significant and important counsel, not only in a lawyer firm, but counsel to Goldenson. I mean, Goldenson and he worked very closely together over the years.
TAYLOR: The unfortunate thing about that ABC connection was, that when ABC was sold to Cap‑Cities, it did McKenna and Wilkinson in.
PAGLIN: It sure did, and a lot of other institutions of that kind. Wilmer, Cutler, and Pickering, Roger Wollenberg, have, don't they have Cap‑Cities?
TAYLOR: Well Wollenberg I think, well I'm trying to think of what happened to the staff of McKenna‑Wilkinson.
PAGLIN: Well, you know, the firm dissolved, and everybody went onto different firms.
TAYLOR: Well, we had a meeting with a law firm recently who said they had much of McKenna‑Wilkinson's old staff, so I suppose that's Bob Coll, Kittner retired, and a couple of others. So that's how Malarkey‑Taylor was formed.
PAGLIN: So that's how Malarkey‑Taylor got started. The whole story of its development of course, Marty has told us in his interview sessions.
TAYLOR: Getting back to Malarkey‑Taylor, I was really quite startled when Martin asked me to join him, because I really didn't know him very well. We had been on the Board of Directors together, and, of course, he was on the Board of Directors while I was the Vice Chairman, so, sure, I saw him in action, and I got to know him in the way that you know people in that environment. But I wasn't sure how much he knew about me, except save my reputation, so it was not the kind of thing where we began working together, and then decided to join, and so out of the clear, blue sky he asked me to join with him, and out of the clear, blue sky I said yes.
PAGLIN: That's the best way things happen.
TAYLOR: It probably is. He's been a wonderful partner, we're as different as night and day, and that probably has been the reason for some of our success. We respect each other, we complement, and during some of the early days, the engineering carried the firm. We didn't have business other than engineering, and it was one time, shortly after we sold Northwest Video, there was a very low spot. Well we just didn't have the cash flow that we needed to survive. I had some money as a result of the sale that I hadn't yet reinvested, so I made a loan to the company to pull us, to pay salaries, and that's the only time I've been in the position to help the company that way, but it's been very good. The roughest time was the '74‑'75 period when the industry was in depression and what the future of the company was, we lost all our staff, it was just down to Martin and myself and a secretary, we took 30% salary cuts to try and survive it. There were a couple of times that I thought I'd better get out of this and start looking for a job, and I've never looked for a job in my life, I had no idea even how to go after one. The two or three jobs I'd had they all came looking for me, so it was scary. I'd talked to Martin, and he said, "Well, you do what you have to do." That was the size of it, and I decided to ride the bucking horse, and hope that things get better. Well they did. So we came out of it all right, but it was a rough period.
PAGLIN: Well, that was a rough period for the entire industry, you know it was on the borderline of a recession.
TAYLOR: Yeah, it was a rough period for the entire industry, it was on the borderline of a depression. Well, we did have a recession nationally, and the whole economy was in trouble, and ours was particularly in trouble, because we had come to the end of the era. We were now talking blue sky, and we had already begun to realize that the blue sky wasn't going to happen. It just isn't that important, and Irving Kahn went to jail, the whole thing was a real disaster.
PAGLIN: But, it's a good thing you held on, right?
TAYLOR: Oh yeah, it's been a great marriage, we mutually respect each other, and we have our differences. He's been totally fair with me, absolutely fair.
PAGLIN: Marty is he a very interesting person to work with? As you say, you know him, and his style is quite different. I see it, certainly from knowing both of you for so many years that, as you say it's a good marriage, because it's like that Black and White Scotch thing, it's two totally different personalities, each of whom brings to the association different but necessary talents.
TAYLOR: One of the things that both of us have had, and I think it's been part of the reputation of Malarkey‑Taylor is that both of us are concerned about integrity. I think that's been what people have recognized over the years is that we make mistakes, and we get into binds that we shouldn't have gotten into, but our intention was to try to keep things as clean and as aboveboard as possible, and we've lost jobs because of it. And we won't do what sometimes clients want us to distort things. But we both see it just exactly the way it is.
PAGLIN: The old thing I've said for years. I don't use an electric razor, I have to use a safety razor, and in order to do that I have to look at myself in the mirror to shave every morning, and I want to be able to shave every morning.
PAGLIN: Well, that's very good, very good, all right. Well, again I think you, and I think this is a good wrap up for this session.
TAYLOR: Might as well.
End of August 25, 1987
PAGLIN: I'm in the office of Archer TAYLOR:, of Malarkey-Taylor and Associates, and we are about to continue our oral history interview. This is interview number five. It is September 16, 1987, 10:00 a.m. Archer, tell me, in a kind of an overview, your overall assessment of some of these early years of cable television, and how they had an impact on the problems of the industry today, and the opportunities for advancement.
TAYLOR: I raised a matter that cable television could be wired into cities and small towns, but to get into the strictly rural areas, such as I was familiar with in Montana and other parts of the country, was just too expensive, and I felt, if we could find some way to deal with the rural service, we'd be half way through our political problem, not that it was a genuine concern of political figures, but that it was a "motherhood issue" that they could latch onto and tackle. My partners and I out in Montana began working on what was called the G‑lines, patented by a German scientist, George Goubau, who was one of the spoils of war, one of the people that came to this country, one of the German scientists, and he was allowed to keep this patent which he held, and essentially it was a coaxial line without the outside conductor. It was just a wire with a dielectric coated on it, and no outside conductor. It was called a surface wave transmission line. It seemed to have extremely low loss, and had some potential for making it possible to get signals transmitted long distances without amplification so that you could maybe get into the rural areas. We got interested in it, but there was a lawyer, he had a German name, and it escapes me again, it'll come back, who was managing Dr. Goubau's patent, and he was insistent that you couldn't even experiment with G‑line without paying him royalties, and his royalty was so much a foot, and it was just a terribly expensive thing, we were short of money anyway, and there was no way we were going to pay royalties just to test this thing out and see if we could make it useful. But we did struggle with it. We did use it, and as a matter of fact, one of my partners who had been involved in a system in Helena, Montana, did install about a 15 mile run.
PAGLIN: Who was that?
TAYLOR: Bruce Hamilton. Ran from the Continental Divide on the McDonald Pass where he could pick up the Missoula TV station and carry it on this G‑line down into Helena to distribute on the system.
PAGLIN: Now was this actually 15 miles of wire?
TAYLOR: Yeah, it was on telephone poles, just like coaxial cable would be, but it was well, wire was cheaper for one thing because it didn't have the outer conductor and you just had the center, and we had to attach it with linen cords, we had to tie it, we couldn't put a nail or a clamp on it...
PAGLIN: Because it had no covering.
TAYLOR: Yeah, it had no covering.
PAGLIN: Down to where did he bring it?
TAYLOR: Into Helena, Montana, the capital of the state. You had to have some repeater amplifiers in the thing, it couldn't go without any amplifiers, but in order to have amplifiers, you had to come from this wire with no outer conductor down into true coax to get into the amplifier. So the way to do that was literally with a funnel; a big long funnel. We used some that were 10 feet long and maybe 4 or 5 feet in diameter. You'd have one of these funnels to catch the signal when it came in and another one to launch it out on the other end. Crazy looking. But the thing we also discovered is that farmers nearby just put an antenna up inside that funnel and they had the service.
PAGLIN: In the region of Helena?
TAYLOR: Well, coming down the highway, a farmer that was nearby just put his antenna up, and pointed it in there, and he got television. So there were a lot of other problems that developed, and it was not really a practical scheme and never did work, so we never paid any royalties.
PAGLIN: Had it been described in the literature anywhere?
TAYLOR: Oh yes, it has been described in literature, and G‑line has been used; utilities have used it, railroads have used it, really using it as a leaky transmission line, so that they could have a pickup to run along it, and pick up the signal. Earl Hickman with Bruce Merrill down in Phoenix did some experimenting with the G‑line. I think he had facilities and the money to do a little more comprehensive testing than we did, but still it turned out not to be practical. The point was that we were trying to find ways to get into the rural areas because we thought this was part of the key to our political problem.
Another problem was this: if you're going to serve these very low density areas, you're going to have to get the cost down. One way is to have long‑life equipment, and low interest rates on money that you borrow. Well, the low cost equipment was going to be up to the manufacturers, but the cost of money struck me, that the best way to get low cost money for rural areas was with some loans comparable to the REA loans. When I was on the board of NCTA there was a bill in the Congress to allow REA to make loans to cable television systems. It was being fought, and it was being fought by our industry, for the same reason that the telephone and the power companies fought REA. They wanted to keep it all for themselves. We felt the same way, or I say we, our industry felt that way.
PAGLIN: Let me understand. You're saying that the proposed legislation to get REA loans in rural areas was opposed also by the CATV industry? Why?
TAYLOR: For the same reason that the electric companies opposed REA loans. A, they called it socialist, B, they wanted to serve those rural areas themselves, and they just didn't want the competition of the government coming in. I made a pitch on the Board of Directors, and lobbied it with our own Board of Directors, and tried very hard to get the Board to go on record as approving this bill. I had supporters. But Bob Beisswenger, who was then president of Jerrold, vigorously opposed it, and we lost. NCTA went on record as opposing it.
End of Tape 6, Side A
PAGLIN: Now that was, let's see, Bob was the president in what period?
TAYLOR: Well, I was on the board in the period '61‑'67, I believe, so it was probably the latter part of that period. That period somewhere in there.
PAGLIN: Could have been earlier, because I don't remember, Fred Ford wasn't president then. So it had to be earlier.
TAYLOR: No Fred wasn't president then, it was earlier than Fred.
PAGLIN: So it had to be earlier, because Fred became president in '65.
TAYLOR: That's right. Bill Dalton was the president before him, we did have a paid president at that time.
PAGLIN: Yeah, so it was earlier than that, it must have been just before '65. No?
TAYLOR: Well, it had to have been.
PAGLIN: Anyway, okay, I'm just trying to probe your time, because I remember I worked with Fred, he came in January 1, 1965, and I served with him until I went back to the Commission which you know, was late '66, and I don't remember this at all. So it must have happened before his time.
TAYLOR: Yeah, I believe it did.
PAGLIN: So this was one effort.
TAYLOR: That was one of my efforts to try to do something about the low‑density areas. Subsequently, as a matter of fact, REA was authorized to make loans for cable systems, and a few of them have been made. As a matter of fact, I did some of work for the REA six or seven years ago in which they were trying to come up with low cost ways of building plants, cable plants. A man by the name of Bill Grant, who had been a former Jerrold engineer, was, and is now, with the REA. He wrote probably one of the best technical books. There were a number of ideas they had that were sound technically, but they asked me to review the one and comment on the idea of tapping the trunk, which is "verboten" general design. I analyzed it every way I could think of, and came up with an idea that if you take certain precautions, yeah, it's a good idea, it could help. It has pushed into the real small population areas, well there aren't too many areas that we can't cover.
PAGLIN: Now, let me ask a question if it is a relevant thing. I remember back in the initial days, that we discussed earlier, that one of the solutions to get into areas where it was uneconomical and in some instances, physically impossible, to reach with hard wire, was microwave, right?
TAYLOR: Yes, this was one of Irving Kahn's ideas, what is now the AML microwave, the multi‑channel microwave. That was one of the things he had in mind.
PAGLIN: What is the relationship between this kind of effort, which is a low‑cost operation, a plant in low density areas, and bringing in microwave? Is there any, or are the two things apples and oranges?
TAYLOR: The microwave turned out to be much more expensive than Irving Kahn had hoped it would be. Then when we began to get into 35, 40, 50, 60 channels, the microwave transmitter became really intolerably expensive to get into small areas. I think it's helped getting into some small towns, and tying small towns together with a lower capacity, and there are some with a fairly high capacity microwave. To get into the really small rural areas, microwave has helped but it hasn't really solved a problem. Others have tried, 4Vic Nicholson is another one, who has been very anxious to try, and help get into the rural areas. I think with him it's a sociological matter, a matter of oh, ideology.
PAGLIN: Where's he from?
TAYLOR: Well, he was with Jerrold in the very earliest days. Retired I suppose about 1975, mid 70's maybe and went with CTIC. Retired from CTIC probably oh, early 80's. I have no idea what he's doing now. He did submit to me a patent which he wanted me to endorse that he thought would help get into the lower density areas.
PAGLIN: What was his name?
TAYLOR: Victor Nicholson, very fine guy, I always liked Vic, very capable guy.
PAGLIN: So, this was something that at least had a realistic basis in terms of the early days, because you solved some of the political problems of the opposition.
TAYLOR: Now the other approach to the very small density areas was translators, and they technically, could do the job. In fact, there was a move, another approach to this was for cable systems to put a translator on the end of their trunk line, and just translate it off what's on the trunk line, you know, the radiation. There were a few of those that were put in place, but it didn't turn out to be very practical. The problem with translators is they never had a source of revenue, they had to depend on contributions of the community. Several of the people at KSL broadcasting station, Salt Lake City, pushed very hard for broadcasters to support translators, and they had in part the same idea of getting service to rural areas that couldn't get service otherwise, and in part, extending their own services for commercial reasons. Some of them did that, particularly in the West, where the sparse populations are, and the broadcast populations were limited so they wanted to expand as much as they could.
PAGLIN: But this was the traditional use of expanding the broadcast television station's area by the use of repeaters, translators, and the like.
TAYLOR: The only really supporting type of funding was when the broadcasters supported these things (translators), otherwise they just went into disrepair because only lay people volunteered. The guy who maintained it had to take time away from his business, and first he did it for love, and then after that it got kind of old. So one by one, they all went by the wayside. There are very few of the original translators actually in operation. Lots of them listed, lot's of them have a license, but when you go and hunt for them you find, well, the equipment is up there on the hill but it hasn't been working for the last nine months.
PAGLIN: The parallel in a related area, Archer, as you remember, were the original cooperative community antennas.
TAYLOR: Particularly in West Virginia where those things started. I did a survey one time, it was one of the first computer surveys, and I'm not much of a computer man. I hired a computer service out in Missoula and we put on punch cards, information on every TV station in the country, and all the cable systems, so that we could then sort out, and find out all kinds of information. It was an interesting study project.
PAGLIN: What was the purpose of it?
TAYLOR: NCTA hired me to do it, and we were trying to respond, I forgot even what the issue was now, at the FCC, there was some type of an issue, and we were trying to respond to this.
PAGLIN: Around when was this?
TAYLOR: It was just before I came here, so it would have been probably around '64, because I moved the cards here, and we never got a service bureau to use them here properly, and finally it just all dissolved.
PAGLIN: So it was an effort to try to find out about community antenna development.
TAYLOR: Oh, yeah, and I found then that there were just literally hundreds of little systems in West Virginia that we couldn't find out anything about. It was just all through West Virginia. There'd be little crossroads that would put up an antenna, and they might have 50 or 100 subscribers and that would be it. They're probably still out there, they're not paying any attention to the rules or anything else, they're just functioning. So there were a good many of those, and they were strictly co‑ops, strictly volunteer, not profit oriented in any sense.
PAGLIN: It was a personification of the public's desire to get this new television service, and I'm talking about the 50's, okay?
TAYLOR: Yeah, now that was the case, I'm sure it was Quincy, Washington, and it was a translator, and that's the one where the ruling came down that this is just like a baby buggy on the highway, it's not hurting anybody. So let it go, forget about the rules.
PAGLIN: Actually, the court said was it was an illegal operation. That's why the Commission went after them, they had no license. But the Court said, "Hey, get off your butt and you promulgate regulations, because this is a service in the public interest." That's what it was.
TAYLOR: Yes, they did, but they didn't provide any economic means of support. At one time, when I didn't know where my bread was buttered, I sent a letter, or a comment or something, to the Commission suggesting ways that they could provide economic support, because they realized that they didn't have economic support. Ed Craney made many, many appeals for ways to use this kind of thing as they do in England, they have repeaters all over the world, and everywhere, throughout Europe. Ed Craney pushed hard for that. Canada does much more of that than we do, bona fide repeating stations were part of the broadcasting station's operation extending their service area or filling in, and so on. The Commission never wanted to do that, and I won't go into the arguments. The closest they came to providing economical support has been the low‑power TV, and that's maybe about five or six years old. It hasn't really become the factor that everybody thought it might, either the problem that we thought it might become, nor has it become the bonanza that some people wanted. You know, one guy filed for 3,000 low power TV's, you know, crazy.
PAGLIN: Oh yeah, and a lot of the religious organizations filed hundreds of applications, some of these promoters filed dozens and dozens of applications. It was the "Nirvana", oh boy, it was going to be the great thing. Every little hamlet was going to have a station. The commission's processes at the time virtually ground to a halt. They were just deluged with 20,000, 100,000 applications.
TAYLOR: Well, I just read a notice either yesterday or last Monday, when I was reading "TV Digest" that they've opened another window now to process applications. They are limited windows.
PAGLIN: Now, in terms of the overall assessment, how did the early days impact upon what was to come to solve some of the political problems of getting service into those areas where it was simply economically unfeasible what other kinds of things were there?
TAYLOR: Now let me try this. Bill Dalton is president for the NCTA, who's the first paid president. His concept was that cable TV ought to find some way to become essential, he used the term essentiality. The telephone is virtually essential. A few people don't have telephones, but you can count them on one hand. Almost everybody has a telephone, universal. We don't have that essentiality in cable, it's an optional service, a luxury service. Only half the people typically decide that they want to pay for it. He was trying to find ways to make it essential. The non‑entertainment services were the ones that kept coming up. This was when the Research Council was formed with Leonard Reinsch as chairman, and I told you we might get Ken Cox as executive director but we lost out. This would have been early 60's. We looked at all kinds of what we then were calling auxiliary services, and one by one as you looked at them, there were good, sound reasons why they wouldn't be very likely to take place, and this has been the case with all of the non‑entertainment type services that everybody has been able to think of, is that one after another they die.
PAGLIN: Why was that, in your view, even in those days?
TAYLOR: Well, I'm coming to the feeling, and this was some time ago that I came to the feeling, that these other things are another business in every case. Take home security for example, and this is just typical. The security business is a totally different business, and you've got to be in a position to run a security business. You have to be bonded, there are certain liabilities, you have legally, reliability becomes a problem, you have to sell, you have to screen, you have to be in the detective business. All of this is a totally different business that the cable operators just weren't set up for. Now when you get down to it, the only part of home security business that the cable operator gets really involved in is providing a link from here to there. You have to go and sell a home, and you've got to sell him on anywhere from $100.00 to $5,000.00 worth of equipment in his home. Sensors, and all those things on the windows and doors and all of those things, but that's another business. We're not in that business, and you can go through one after another of all these so‑called "blue sky" things and you find out that it's another business.
PAGLIN: Other examples would be banking, meter reading...
TAYLOR: Load management, all we are is the link between two points. The cost, the problems of running the business, all of these things, the revenues you get from it, have very little to do with the cable business, and most of them can be handled just as well, and some of them better, with the telephone than they can with the cable, because our two way cables are not really a very flexible operation. They aren't designed to be, they're a strange animal.
PAGLIN: Now let me just refine this a little, because this is a very significant point. You make, what I consider to be a valid distinction, that is to say with the auxiliary, so called non‑entertainment services. But would you further refine the word non‑entertainment? In the apposition of entertainment, non‑entertainment, would you have seen a role in those days for cable television in what we know now as public access, not entertainment as such, but what we call today access channels. Would you agree that that function is different from the ones you described as being other businesses, for CATV to have as a significant role?
TAYLOR: Yes, I think that it never has seemed to me that that had the potential for being a significant factor.
PAGLIN: Information services?
TAYLOR: Public access. Education access, I think a lot of us saw some merit in, and we pushed on that. Public access being here's a studio, here's a microphone, anybody that wants to come in, there it is.
PAGLIN: I mean services that are part and parcel of cable operators, potential centers to the community, which would not only be carrying network programs but talk programs, education, city council meetings, stuff like that. Did you in the early days see that to be a function of cable?
TAYLOR: Since 1972 in the rules, we call these PEGS: public, educational, and government access, PEG has come to be used to describe these. The education/government, yes, we have looked at that. I had great hopes at one time. I was on the staff at Montana State University, worked in education, and did some traveling to educational conferences and so on. Met a number of people who were active at the time, and thought I saw some real applications of television in education. I have become sour on it. When my kids were growing up we had audio‑visual aids, and audio‑visual aids in schools were great things, they were wonderful opportunities, enlarged the horizons, improved education. What it amounted to when my kids were in school was, "Wednesday was movie day". You'd go and see a movie at 9:00 in the morning or whatever, and the movie might be Firestone in the jungles of the Amazon tapping trees for rubber. But it had nothing to do with the class work, it wasn't coordinated at all. One of the most interesting experiments that I saw was the Ford funded project up in Hagerstown, Maryland. I visited there, talked with the people, and that was a kind of an exciting project. It was cable distribution, they had six channels, they had four programs, the extra channels were for standby for one thing, to cover down time and for such things, for example in the Geometry class, they might use two channels. One screen would show the proposition and the other would show the proof of it. The teacher could use this, you'd have an expert at the studio, and you'd have six or eight schools around the county up to distances of 15, 20 miles from the central office, but you'd have the expert teacher demonstrating this and doing it on the blackboard, and the teacher in the classroom simply using that. It seemed like a great idea. Ford obviously thought it had a lot of merit, and the people in Hagerstown thought it had a lot of merit.
PAGLIN: This was when, about the early 60's?
TAYLOR: Yeah, this would have been '63, '64. Well, that just kind of died out, the primary reason being money. We used to argue in the early days that this would be a way of saving money. Of course that gets into a human problem, because how do you save money unless you hire fewer teachers. Well, you don't pay them less. We figured that they'd pay them more, because they'd be using higher quality teachers to teach by television, but you still had to have somebody in the classroom to maintain discipline and that sort of thing. It ran into essential conservatism of teachers I think. Their jobs were at stake, literally. Plus the fact that they were not creative, not many teachers. There are always some excellent teachers who would be creative and imaginative in how to use this medium. But mostly they were mechanical users, "Wednesday is movie day". So you get three classes in here at 9:00, and you run the movie again for three other classes to come in at 10:00, and you know, that's not educational television.
PAGLIN: And yet today, activities of this kind, technically speaking, are being done around the country.
TAYLOR: I think there are some. When I was working for Fairfax County, back in the late 70's, I did an assessment study, interviewed a lot of people. They have a school in Falls Church, or near Falls Church. It was their audio‑visual center, and they had an enormous library of film, slides, filmstrips, all of these things. I don't know if they had many tapes at that time. It was a little early for that. Every morning, out of that building, would go, these big laundry things, you know, these big bins. Probably four feet long, and three feet wide, and standing four feet high on casters, and they would fill these bins up with the orders for the teachers in the schools all through Fairfax County. They'd load them up on trucks and the truck would go around and distribute these things.
Well they were really quite excited about the idea of using cable to distribute them. They'd have a studio. The teacher out in one of the schools would say, "I want such and such a film out of the catalogue." The catalogue was all computerized, so that it could be accessed by computer. "I'd like to have this at 10:30 on Thursday morning." So you could arrange to have it done without all of the trucks, and the bins, and physically transporting this stuff. Besides, it would be available for use, because it wouldn't be out on the road. I don't know if the institutional network was put into Fairfax County, and I have not been back to see whether or not it's actually used. I'm sure there are some instances where things are being used, but they're still pretty limited. They're limited really by the imagination, and the ability of teachers, to know how to use this tool, and since they don't know how to use it, they still tend to think of it in terms of being just a toy and a diversion to take care of those nasty kids. But, still, cable was not very much involved, and this is how the institutional network came up.
As far as I know, this was first proposed down in Richmond. Continental, I think it was, proposed it, although, I somehow think Cox was one of the first separate cables to handle just these institutional things; education, government, and very quickly it moved into commercial applications. But the realization, the implementation of institutional networks around the country is almost zero.
PAGLIN: So you would sum it up by saying that there was a potential, technological application of cable which, for reasons that you just described never got off the ground but certainly didn't realize its potential.
TAYLOR: Well, I think the reason in education is the same thing that people say is the problem with education generally. The teachers are not the top quality people that are needed, and why are they not? First of all, they are not paid to be top quality people to attract them. Oh, I remember the feeling I had at the University of Montana when people would say "Well, I flunked out of physics class, so I guess I'll go into the school of education." The School of Education was the dust bin that caught all the people that couldn't make it anywhere else.
PAGLIN: That old canard, if you can't do, teach.
TAYLOR: Yes, but unfortunately it's real. We aren't set up to do that and I'm certainly not wise enough to know how it should be done.
PAGLIN: Was there a conception in the early years that cable had a realistic relationship to broadcasting which might someday make them, instead of always enemies, make them colleagues, allies?
TAYLOR: Well, before we had satellite transmission, we kept trying to make the point that we are not competing with you, we're extending your service area, we're making the reception easier for your signal. All of these things were true. But it was also true that we brought in distant signals that would compete with them, and we got into copyright problems, and so on. Milt Shapp said many, many years ago, and there was an awful lot of merit to it at that time, and I don't think there is anymore; that we didn't compete with broadcasters, we're in competition with antennas. Because it was the rooftop antenna that was our competition.
We didn't want to compete with broadcasters, we weren't after their market, we didn't go after the advertisers, we weren't really competing with them in their market. We did compete with them, well, not really, for viewers. We gave the people more choices of viewing, which therefore did, well they used to say fractionalize audience, which is undoubtedly true. But of course this is happening in spades now, with VCRs and all of the other things. We hoped that we would someday be more friendly with broadcasters because we were an extension of their services. But I guess we really lived with the idea that we were simply subsidiary to the broadcasters. I guess I've always kind of resented a comment that Dean Burch made, and I don't know where he made it or under what circumstances, but he said, "...that it's up to you whether cable is going to be just another way of moving broadcast signals around (hardly worth the ulcers involved) or whether it is going to become a genuinely new and competitively different medium of communication, offering everything from entertainment and sports and movies to classroom instruction and commercial services and public rap sessions." I think it's turned out that it's most useful place has been in entertainment. Entertainment used broadly to include news and information, and distribution of the broadcasting type of television for the residential user.
PAGLIN: Were there any other situations like that that had their impact years later which indicated how the industry would develop that would indicate even the opportunities that we have today because of the advance of technology?
TAYLOR: Probably in the 70's with the franchising battles that were opened up with satellite transmission, we began to get into some thinking about actually providing voice telephone service in some limited areas. In fact, one of the things the people in Fairfax County were interested in, was having their own private telephone system between county offices, closed‑circuit type telephone, really an intercom type telephone, using the cable for that purpose.
I always felt that we were going to come into some severe opposition from Bell, but I hadn't anticipated the divestiture situation, because now, it seems to me, that if they're competing with us by golly, let's compete with them. It's an open market situation. Bell still doesn't see it that way. It does seem to me, that if they're going to have more freedom to compete with other people, they've got to be prepared to accept the competition too.
PAGLIN: And yet Judge Greene's recent 223 page opinion in the divestiture doesn't go that way.
TAYLOR: It's still uncertain. With the introduction of the institutional network concept, which really was a concept in franchising that became so universal, our fees for franchising usually required that you provide distribution that way. After a while they got to where it was required in their municipal ordinance. We began to get to the point where this would also not only provide the PEG services, but the commercial services. Up until the last two or three years the story has been the so‑called T1 telephone channels, the high speed data channels on telephone wires. The telephone company was just not equipped to provide them, and they had orders for T1 channels that, kind of like season tickets at Redskins games, you just couldn't get them, because they just didn't have the plant to handle them. Well, we had a plant with the institutional network that was just natural for it. It was just beautifully set up to handle T1 channels and we could provide 15 T1 channels and really provide the service. That didn't happen. Why? I'm not quite sure.
I'd rather imagine that the legalities that were involved, Cox's problem in Omaha, for example, probably set them back. Although, when I talked to the lawyers about the Omaha case, it was not a clear‑cut case, either for or against the use of cable for, as we call it the "last mile" coming in from the satellite communication teleports to get from there to the business establishment. We had the facilities, we had the capability. Why it didn't happen probably is along the lines of what Cox ran into in Omaha. Cox had the technical knowhow, they hired the people to do it that knew how to do that. Not too many of our cable people really know how to do it. They are beginning to learn, but we're not very expert at it. Why our industry has never really gone after it, I've never really been quite able to comprehend. After the last mile commercial data business, I've concluded that there wasn't any real application for data transmissions to the home, and there just isn't that much going on there. There have been a lot of ideas put forward, Jerrold and others had ideas.
PAGLIN: Or is it that the market that's out there in business is not yet matured to the point where they realize that this is something they need?
TAYLOR: I think the market knows that they need something. They don't know what they need. Our industry hasn't known how to go out and sell it. I had felt for many years, not many years, 2 or 3 years I guess, about what has to happen is a Ted Turner. Now Ted Turner did his satellite transmission, the Super‑Station, and anybody in their right mind would have told you, at that time, it couldn't be done. In fact I had long conversations with Ward Quaal, because I wanted to get Chicago's WGN in my system in Kalispell and I thought I could see ways to accomplish it technically, but when I talked with Quaal, he said it can't be done. He gave me 100,000 reasons why it couldn't be done. Turner faced exactly those same things, "It can't be done". Well, Turner said "The hell it can't." and he went and did it.
PAGLIN: The old bumblebee syndrome.
TAYLOR: Exactly, and that is what I have maintained is going to have to happen for the cable industry to get into data. Somebody is going to have to say "I'll fight the telephone company". I know there's equity in doing this, I know that it's right, that it's a good argument, I just have to get lawyers that will make my case and have the guts to pay them, and so on.
PAGLIN: As people in show biz say, you have now segued into the next subject, which is your predictions for the future role of cable in the development of telecommunications. I mean in terms of technological advances. Now, this is one, obviously in your opinion, right?
TAYLOR: Oh yeah, so far it looks like the window might be slammed shut. Whether we can get our fingers out before it cuts them off, I don't know. I'm not so sure that it's still possible.
PAGLIN: Bring us up to the point where we are today in terms of cable being an essential integral, critical part of the entire complex of telecommunications.
TAYLOR: Well, telecommunications is a broad term, and if telecommunications includes television and broadcasting, then yes, it is a part. If telecommunications is construed more narrowly to mean point‑to‑point communications, then no. Well, if the term is used generically to include all of these, there is no question, it seems almost so obvious that it is. In the 60's we were trying to find essentiality in order to become like the telephone company, or the power company, everybody had to have it. I guess I've always felt that we're experts at distributing video and audio signals, primarily video signals, to residential homes at a relatively low cost. I suspect that the telephone companies will be our biggest competitor, along with some others, the telephone company is not the only one.
Just as an aside, it strikes me that our industry, now at the age of not quite 40 years, is not really mature, but is getting to the point where now we've got enemies like the broadcasters considered we were. We're in the same position. I guess everyone wants to have everybody else maintain a status quo, but we can go ahead, and do what we want to do. That's obviously the best of all worlds. But we're not in the position of the broadcasters, we're fighting this, that and the other one. Oh, and I might add, for good reason. The telephone companies competitively are probably the biggest threat on the horizon. In the old, old days, Western Union and Bell System divided communication services between pulse code services and voice services. Western Union took the code services and the voice services Bell Systems took. If there is a division of that sort, I'm inclined to think that it'll be that we continue to do what we do the very best, and that is distribute video signals, television type signals, entertainment and information to residents. The telephone company is more apt to take the much more lucrative business of voice and data into commercial establishments, and voice, certainly, into the homes. I really don't see us competing with that. We've talked about it from time to time, but I really don't see us competing for the voice services. Data, so far, nobody has identified any bona fide really profitable needs for data in the home. Some limited things, but not very much.
PAGLIN: By cable.
TAYLOR: By any means, telephone, or anybody. Trintex, this company was originally CBS and IBM and Sears, Videotex, Teletex, CBS pulled out of it. In fact they have pulled out of most everything. There have been a number of Teletex and Videotex experiments and everyone of them has come out saying that there isn't any market. It's a solution looking for a problem.
End of Tape 6, Side B
PAGLIN: You were saying Archer, that didn't seem to be a market for service...
TAYLOR: I used the other expression, "a solution looking for a problem to solve." Telephone competition is an interesting one. I spent quite a bit of time analyzing this and wrote a piece. I write a monthly column in the CED magazine, and in one of them, I won't say facetiously, I said, "You know the greatest way of predicting in the world is the way the weather bureau predicts the weather; the 20% chance of rain, and the 90% chance of rain." There isn't any way on this earth that you can prove that they're right or wrong. Unless they say there's a 100% chance of rain and it doesn't rain or a 0% chance of rain, and it does rain. That's the only way they can be wrong. but if they've got any number in between, there's no way you can ever determine whether or not they were right. I did a lot of predicting on the same basis, 20% chance this or that. I think that the real key to telephone companies competition with us is getting a fiber service drop into the homes. The telephone companies for as many years as cable has existed, have talked about a single service drop into the home. Everything going into the home in one wire. Now they don't talk wire they talk optical fiber but it's the same thing. They are developing the technology, there's no two ways about it, by which they can distribute just about anything that can go in now, they can distribute it on their one fiber. What's technologically possible doesn't always happen. It's technologically possible for you and I to go to the moon and back. We know that that's possible, it's been done, we know it can be done. It'll cost more than $25.00 to do it, so there are problems. There's no question that the telephone company can technologically distribute any of these things into the home. One of the things I think is that the telephone company is not able to do the low cost job that we do. They may even do a better quality job, but there are lots of people who don't buy Cadillac or Lincoln automobiles. There are lots of people who buy Fords, there are lots of people who buy second‑hand cars. There are lots of people who buy Hyundais that are $3,900.00.
PAGLIN: In order to serve the public, these industries, some of them don't realize you don't need a Cadillac, in terms of the public's need and the public's willingness to buy or use that. Am I right when I say IBM originally, when they came in with the personal computer, offered strictly Cadillac service? It later turn out that the public doesn't need a Cadillac. You can bring them something, that instead of $2000 it's $300 and does the same job. Isn't that what you're talking about?
TAYLOR: That's right, that's exactly right. The example that I cite is one from Jake Shekel, a Jerrold man, now out of the industry. He was moderator of a session in Montreux, Switzerland, 10 years ago, and he said he was looking through a microwave professional journal. He saw an advertisement for a power splitter and just idly looking at the thing he said, "You know, that looks familiar, those specifications look familiar." So he went to a Jerrold catalogue, got out a Jerrold power splitter and examined these things, and spec for spec they were almost identical. The microwave unit cost $450.00, the Jerrold unit cost $25.00. Performance, specs, exactly the same. Which is an example of why we have been able to do things at a lower‑cost basis than the telephone companies have been able to do.
Another example is in our amplifiers, and I may be obsolete in this statement now, but I have said, and up until about 8 or 10 years ago I know I was correct. Our amplifiers are more linear than any electronic amplifier from any service of any kind. I don't care if it's military, or audio, or whatever the purpose. Our amplifiers have to be more successful, more linear than any of those. And we build these amplifiers for say 8 or $900.00. That's the buyer's price, the manufacturer's price may be half of that. A hundred times better performance than, say, a good Fisher audio amplifier, for which you can pay $1200.00. So we learned how to do this at low cost and make it fly.
PAGLIN: But the nature of the business is different. If what you say is so, nobody in the cable industry has said, "Well, how about our going into Radio Shack and making this available for the guy's living room?" That they haven't done, have they?
TAYLOR: I'm not quite sure what you are saying.
PAGLIN: See what I'm saying, you said that these amplifiers are far more efficient than...
TAYLOR: Oh, I see, they don't do exactly the same thing, they don't drive the loudspeaker, it's an analogy against the competition of the telephone company, I think we still have the ability to do the home distribution service at a price that the telephone company cannot afford. Now there's one thing that the telephone company can do in their switched system, and what they will do. I've read a lot of their papers on the subject, and there's no question of what they have in mind. They will offer you the customer, the public, the residential user, what you want. "You just tell us what you want, and we'll deliver it to you. If you want HBO at 9:00, we'll deliver you HBO at 9:00. If you want WRC at 9:00, we'll deliver you that one, whatever units you want, we'll just switch it in and you'll get it. You won't have any device. You just have to tune your TV set to the outlet, or better still get a video monitor rather than a TV set, you don't need the TV set." They could do that. They keep saying over and over again, (the telephone company says) that they do not want to get into the programming business. So, they will be selling the distribution only and it'll be between you, the user, and HBO. Then you'll get a separate bill from HBO for that service.
PAGLIN: And they would be only the conduit.
TAYLOR: They'd only be the conduit.
PAGLIN: Of course that's been their traditional role.
TAYLOR: That's their traditional role, and they say they want to hold that traditional role. Our industry will continue to have a place for a long, long time, against telephone company competition. Because the telephone company, with all of the things that they can do, there isn't any question but what they can do it, technologically they can do it, and given time and considering the volume in the integrated circuit chip type of cost cutting, yeah, they could probably get it down to where it's lower cost. But I just don't see them coming in and competing directly, and they say they don't want to either, they keep saying that.
We do have other competitors, however, and video tape is probably the biggest. I read the other day that there are more VCR's than there are cable subscribers, the figure's now surpassed. Where I see the real fight coming within the next ten years is over the quality of picture. We've got high definition television, and it's the buzzword today. It's a misnomer, definition is only a small part of the problem. The quality of the picture and a wide screen, you know like you have in the movie theater, is unquestionably going to be superior. And as of this very year (1987), by Christmas time, I'm told, there's going to be on the market, super VHS VCR's where you have a video monitor, or a TV set with Y and C inputs, the luminance and chromance inputs separately, as components, rather than in the composite NTSC signal, National TV Systems Committee. There are sets built like that today, particularly projection sets, larger screen things. It would be the high end of the line, but there are sets that are capable of it now, and these super VHS players, along with the super VHS tapes are going to make a much better looking picture that you see on cable or on VCR's today.
PAGLIN: A question, because I've been reading about it too. Are you talking about taped programs, or off the air, or are we talking about both?
TAYLOR: What I'm talking about is taped at this point.
PAGLIN: The tape, is it going to be a pre-fab tape?
TAYLOR: Yeah, you'd rent it, or buy it.
PAGLIN: But this would be what we know today as what's in the VCR stores, right?
TAYLOR: Right, if you buy an ordinary tape, any tape that you can get now, and put it on his machine, it'll play, but you won't have any special benefit from it. If you buy one of the special super VHS tapes, or rent a super VHS tape, play it on a super VHS machine, and have the adaptation of your TV set; and incidentally, any TV set can be retrofitted to have these features added rather simply, and I suspect that it's going to be a booming service for dealers and servicemen to retrofit. Although when you get the bill for it you might decide you'd rather go buy a new TV set. But it is going to be a better quality picture.
PAGLIN: Let me probe this a little bit. We are talking about what I happen to call pre‑fab program material. Now that does not have the immediacy of live programming. You're not saying that that's going to supplant what we know today as live programming.
TAYLOR: Well, not by Christmas of this year. This is what's going on at the Commission right now. They've got a Notice of Inquiry out now on HDTV.
Where this goes, I'd hate to try and predict now. But let's say within the next ten years we're going to find that the super VHS demonstrates to people that better quality pictures are available, and they're going to started demanding them. How do they get them? Even on cable we get kind of tired of what Fred Stevenson used to call 44 men on a football field, watch the Monday night football and there's no sound on it and our pictures are not as good as they ought to be. They're going to show to a disadvantage against the super VHS.
PAGLIN: Even though, originally, the selling point of cable was quality as against off‑the‑air broadcasts.
TAYLOR: This I think is the big struggle, technologically that industry is going to have to face within the next ten years. Super quality over‑the‑air has a problem too. That isn't going to be the easiest thing in the world to accomplish.
PAGLIN: And cable is going to be at the low end, so to speak, is that right?
TAYLOR: Right, of course, this is where, in Europe, DBS begins to come in, direct broadcasting from satellites. If you have a receiver for the DBS then you're not as limited in quality as you are when you have an NTSC receiver, so DBS can do the high quality thing which the terrestrial broadcasters are not able to do because they're stuck with that six MHz channel.
PAGLIN: One of the proposed benefits of DBS, was that they could receive high quality definition television service. The answer on the other side is "but it's just showbiz." Enough entertainment again, why should we use up that frequency.
TAYLOR: Well that argument is being used, that's the fight between the broadcasters, and land mobile, that is better use for the frequencies.
PAGLIN: But, in so far as the opposition in cable, you're saying that with this technology there could very well be a problem down the road.
TAYLOR: I think cable has a problem. I'm on a committee of NCTA now studying this HDTV matter and there are several subcommittees just beginning to be formed to dig into it, and find out just what is the nature of our problem. The difficulty in this is we can't do it analytically, and we can't do it experimentally, because nobody has the equipment. We are trying to identify where the problems will be, and what kind of solutions there'll be. My guess is that it's going to require some major changes in the way we set up our cable systems.
PAGLIN: And again, as I can see your eyes sparkling, that this is going to be just as fascinating as the early years, and even more so because of the quantum leap of the technology. And here we go again. Bill Daniels said to me when we finished up his oral history, "Max, I want to be here 50 years from now to see what is going to happen." And I said to him, "Bill, I already have tickets." And he said, "All right, we'll meet there."
TAYLOR: Well, one of the interesting things is that it's not happening in a vacuum, it's happening worldwide. The struggle in Europe over HDTV and how it's going to be handled is fascinating. It's technological, but it's highly political and economical. An interesting ideological schism, that's one of those things that there's just no answer to it. The problem is, that it's better to make a quantum jump, and do the thing right, even though you can't get from here to there easily, but you have to make the big jump. Or is it better to go into gradualism, and you have something that's compatible and you move along and you finally get there. You know, I suppose that those are different ideologies, that people are born with, you know, different approaches to problems.
There's a big buzzword involved here and that's compatibility. To the Japanese, HDTV is not compatible, although they're trying to argue that there are ways to make it compatible, but they haven't come up with it yet. The Europeans feel very strongly that you have to be compatible, and you go back to our 1952 color TV issue, and we had to have compatibility then. I guess I personally feel that you have to have a way to get from here to there; that you've got to have compatibility, at least to a certain extent.
PAGLIN: To the extent that you haven't discussed them before, focus, if you will, for the next half hour on what you see in the future regulation of cable. Is it going to be free market, or is technology going to require, again, re‑addressing the problem?
TAYLOR: Well I think that our industry is no different from any other industry, in a period in which deregulation has been the name of the game. Eliminating all regulation is almost libertarian. Let anybody do whatever they want to do. I think we're finding out that this has been a mistake in some areas, airplane deregulations is a classic example. Almost everybody agrees that there's going to have to be somebody step in and put some order into the chaos.
PAGLIN: Railroad and trucking the same way.
TAYLOR: Gosh, you know, it just makes me sick to ride the train in Europe. It's so beautiful and well run and of course, it's government supported, and our railroads are a mess. As far as passengers are concerned.
PAGLIN: Well they're government supported, who do you think is running the railroad here these days?
TAYLOR: Well then why are they supported so poorly, not efficiently, not doing anything well? I think this whole deregulatory concept that we have today politically, it's on one of the pendulum swings, it's going to go the other way. We're going to find that we've got to have regulations for this, for that, and the other thing. We're at the high point of the pendulum, it's going to go the other way. We'll probably not let it go too far the other way, but it always happens. For example, the situation we had in Sacramento. Harold Farrow's game of getting open franchises, the idea that somebody can come into Sacramento and "cherry pick" the profitable places and not serve the others, whereas the Scripps Howard system has to serve every home. I don't know how it'll happen but that kind of inequity just can't exist. It can't last, it's got to change. It can change by making the new operator follow the same rules, or it can change by taking the rules off the first operator. It's hard to say what will happen, but you know that there's just no way that that kind of an inequitable situation can long exist; it's unstable. It can't stay that way.
The technical rules have been so completely wiped out. Even the Commission's limited rules which were so, well, they were deliberately made not very restrictive, very easy to meet. Sid Lines agreed with me that they were very weak, that they were not really serving the public in a certain sense. He said, "Well, what we want to do is get the industry to do something, and to do something is better than doing nothing", and they've been doing nothing in the past, so it was a little better than nothing.
On the other hand, there have been some tendencies in the past, AMST for example, always wanted some extremely restrictive rules, shall we say "killing rules" that would destroy the cable industry. We ran into a city in California, it was quite a while ago, and I don't remember quite where it was, but obviously some of the Silicon Valley people wrote the rules, and it would have taken half a million dollars worth of test equipment just to test the rules. It was just impossible. That kind of thing can happen. I don't really think it will happen but I think there's going to be some more technical controls coming in, but how they're going to come in, I don't know.
PAGLIN: Not only because of a kind of anarchy type situation like Sacramento, but also the technical quality of the signal.
TAYLOR: That's right, that's right, and that's going to happen because of the HDTV development. Some operators who are going to be conscientious are going to find ways of solving it, but it costs money and many operators aren't going to be willing to spend the money. So there will be pressures by the public to get these guys "off the can" and get them to do something.
PAGLIN: So what you're saying ‑ again in tandem with the development of the industry, technologically, is that there has to be a role for government regulation in the interest of the public end of the industry.
TAYLOR: If everybody in any industry, if all the participants in any industry were highly motivated, highly conscientious, public spirited there would never be any need for regulations. It's always the bad apples that cause the problem, and bad apples may be a misnomer because sometimes there's circumstances that aren't really bad, you know. You do it, or you go bankrupt, and who wins when you go bankrupt. Sometimes you get into that kind of a dilemma. So it's not necessarily bad apples, but it's bad situations that create regulations, and it's going to happen in the end, there's no question about that.
PAGLIN: When you come to standards such as you've been discussing, what is your view Archer, with regard to the role of government in terms of attempting, with the cooperation of the industry, to set standards as against the so‑called marketplace?
TAYLOR: Okay, we have to talk about two types of standards, one is interchangeability, the other is performance. The FCC has begun to duck the interchangeability concept, leaving that up to the marketplace to develop. I can argue that one both ways. They mandated interchangeability standards such as our television standards, and color television. It's usually decided not too long ahead, with not too much perspective in time. It's decided for right now, and this is the best way to do it, and we've got to have something, so it's good.
PAGLIN: For the purposes of the tape for someone who reads this, a quick definition of the interchangeability problem.
TAYLOR: Well, a classic example would be color television. If one broadcaster uses the PAL system, another uses NTSC, and another uses SECAM you would have the following situation, ‑ unless you bought that particular kind of receiver, you couldn't get color television. It's not quite the same as compatibility; it's just that if you want people to be able to receive your programs, they'll have to have certain technical elements which are common.
PAGLIN: Is that similar to the problem with the AM stereo?
TAYLOR: Exactly. The FCC decided not to introduce interchangeability standards, and there hasn't been enough market strength to develop de facto standards. So nothing has happened, nothing but confusion, and the whole idea has been killed by not having an interchangeability standard.
PAGLIN: In the case of TV stereo, multichannel TV sound, MTS, they left that one open, but I think they knew pretty well where the de facto standard was going, and it went that way. There are those in the industry who felt it was a bad mistake, that it was the wrong way to go, it was the weakest of the systems except it had the market power to make it fly. But then, market power is political power, and I'm not sure that there's a whole lot of difference. Suppose the FCC had been willing to decide the issue. Political power might have been the same as market power, and it probably would have come out the same way.
PAGLIN: But there have been instances, have there not, throughout the history of telecommunications, before this whole concept of competition being the great good where the government and the industry, the technical people as well as the marketing people, felt that if you got the government and the industry technical experts together, and sat down and analyzed the characteristics, the needs, etc., and came up with at least, the most political standard, if not the best, for the development of this particular whatever.
TAYLOR: Yeah, I think it has. I think the history of television broadcasting in the United States is a classic of that. Before the war, probably, it was almost exclusively RCA, Sarnoff, and the FCC. Sarnoff's people in the laboratory came up with the standards for television at that time. Black and white television, obviously. The war came along, and in this sense it was an extremely fortunate thing, that it froze the whole thing; there was no more development taking place during that period. So you come up after the war, now, we've got an opportunity because there's a vacuum at this point. We have the opportunity now to do something different. This is where the NTSC group came in and established standards (still talking monochrome), but they did move up to the 525 lines standard, away from what was it, 441 lines I think it was, moved up to the 525 lines, and I don't remember exactly the story, but this 525 was decided over the phone apparently, two guys talking together, it was Don Fink and W.R.G. Baker at the time.
PAGLIN: He (Fink) was with, it wasn't Dumont, I forget.
TAYLOR: He was with McGraw‑Hill for a long time. Well, it doesn't matter really, but the NTSC was a broader thing than just RCA and the FCC, and they adopted standards, but they knew they were going to have to do something about allocation, they had a freeze.
PAGLIN: I can tell you what happened, because I was involved. The first, initial allocation of television channels was in the 40's, the very early 40's. After the war again, there was the quantum leap of technology, and they realized the spectrum was much broader, and there was really much more opportunity for what could become a nationwide system of television, not just a system of channels, right? So they froze everything in 1948, it was the famous Docket 6651. The FCC said, let's have a look at this, and that's when all of this began to happen.
TAYLOR: That's right, that's when the UHF came in.
PAGLIN: That's right, and color. CBS, you remember the wheel.
That's when Sarnoff said, "Wait a minute." Sure, that was just because, if you remember, CBS had been declared, initially, the preferable technical system. That damned color wheel.
Then came the Korean War, and put a halt on it. I remember the story. Sarnoff said, "If I let CBS get one on me..." and he tells the guys in the lab, "You've got to come up with a compatible color system without a damn wheel." And by that time they got back to it, after the Korean war, they had it. But it was a standard set up by the industry. And that's what happened.
TAYLOR: Well, it was driven by RCA. No question.
PAGLIN: Oh, absolutely, because it was the General, General Sarnoff. So in '52, when they had the expanded allocation, the Sixth Report and Order, they lifted the freeze, and pfffft, everything went off.
TAYLOR: TASO (Television Allocations Standards Organization) then, that was late in the 50's.
PAGLIN: Yeah, TASO came later, that came later.
TAYLOR: Well, the way it came about, it was industry that really provided the facts, the information, experimental evidence and so on, and basically, almost agreed, not unanimously, but would agree with a strong consensus. The government would say, "Okay, you guys have agreed that this is what it will be, now (tap of a gavel) it's the law."
PAGLIN: And that's what standard setting is.
TAYLOR: That's what standard setting is, and that's what hasn't been done in several of the recent cases.
PAGLIN: Right, that's my point. Remember in My Fair Lady, the song, "Let a Woman in Your Life"? You know, I wanted to say, "Let an economist in your life, and they will screw it up all the time." Well, that's what happened. This marketplace concept just like the AT&T divestiture, Archer, those were the economists in the Justice Department who conceived it, right? And this whole marketplace concept is an economics concept. It is not a technological concept.
TAYLOR: The sad thing to me is that it was extended to the technology, instead of sticking to the economic category.
PAGLIN: Right, that's right. So now we get back to the question of your view. In order for there to be the kinds of technological advances in cable, is it your view that there will have to be some kind of a role by the government, in terms of the technological development?
TAYLOR: Oh, I think there's no question, and I think where it's going to be very, very noticeable is in the area of high definition television for instance. HDTV. That's a whole new, technological area in which there's got to be some kind of standardization. Whether it's de facto, or planned. If it's planned, it's done by government with the cooperation of industry. If it's de facto, the government just stands aside and says, "Go to it, gentlemen, and may the best man win." I think there's too much at stake, internationally for HDTV, for the government to completely stand aside.
PAGLIN: Do you think it's right where there will be a public consumer aspect for the government to say, as you say, "May the best man win"? Won't we run into situations, as in the early days of subscription television, where the government said, "Wait a minute", to the Zenith System? They said, "Okay, we will allow it, but you can't sell these decoders. You have to lease them, because, after the experimental phase this decoder thing, it might not turn out, and the public might be stuck with these dumb things." Is that a role for government, too, in terms of technology?
TAYLOR: That's really getting into the economic area, actually the public interest area.
PAGLIN: But it's the economics of technology, isn't it?
TAYLOR: I haven't thought about this, frankly. It seems to me, that this is an area where the government, taking the example you just cited, was probably one of the great inhibitions on subscription television taking off, although I think there were some fatal problems otherwise. But once the government makes an edict of that sort, it becomes very difficult to change, the flexibility is lost. The ability to improve, to do better, gets lost. The example you used, and I had forgotten about not being able to sell the decoders, as a matter of fact, when I'd read that in the rules, I thought it was to protect the security of the system. They didn't want people to buy them and become pirates. I thought that was the reason for it. But down the road, as STV just didn't take off, they began to loosen these ties to help it take off.
PAGLIN: Number of stations in the market, etc.
TAYLOR: One thing after another including releasing the decoders. Speculation is always questionable, but, had Zenith been able to sell their decoders and build a market for them, cost could perhaps have come down. costs are so tightly related, especially in this day and age, with volume. If you could get a million items of a product, you could cut the cost by a factor of a thousand, frequently. It's just incredible what you would do with the volume of sales So there's much to be said on both sides of the thing. When we were working the satellites, the first time we had a global system, as against, you know, submarine cable, or even wireless. You suddenly have the interaction of worldwide regions that you didn't have before.
The thing I became very conscious of this year while I was in Europe on two different trips, is that these satellites have "footprints" of availability, and they try to tailor the footprints to the national boundaries, but they just don't comply.
PAGLIN: Such as Charles DeGaulle.
TAYLOR: It's a token compliance, and there isn't any way you can change them. When you were telling the De Gaulle story all I could think of was the Danish King who stood out on the beach and tried to make the tide stop. You can't do it, because of the laws of nature, once you've got the technology. So I'm seeing in Europe, several things. One, Europeans, with a few exceptions, have carefully segregated programming transmission, both in cable, and in broadcasting, telephone, everything. It's tightly segregated, and governments have, with a few exceptions, maintained very tight control on the programming which is available within their own countries. Norway, there's one program, there are 8,000 stations throughout Norway, one of them as low as 3.5 milliwatts.
PAGLIN: Around the corner coverage only?
TAYLOR: It must be to serve one home or something. I don't know, but at any rate, only one program was allowed. They finally have allowed the Swedish stations to come in for "the Ted Turner" reason, that is the cable system at Oslo picks up the Swedish stations on a high point, and they have been allowing them to microwave the Swedish system in, but you're not allowed to pick up the Swedish station directly because the Swedish signals are put on the satellite directly, but you're not allowed to use those. You have to use them off the air, then it goes to satellite.
PAGLIN: Well, as you say, this is just such a fascinating time to be living.
TAYLOR: We had a man in England and Israel the last two weeks, who came back very excited and said, "There's so much they need to do in England. They need to learn to get this thing off the ground." He just wishes there were some way we could get in and do something about it.
PAGLIN: Well, this has really been very fascinating. We have, as far as my outline is concerned, we've completed our interviews.
TAYLOR: Well, I've enjoyed this. We're talking about the future, the problems, and how we're going to deal with them, and so on. It's a particular interest, and I could probably talk about it for a long, long time. Let me get to a whole other subject. You asked me to get together things that I have written, and here's part of it.
PAGLIN: I see, you're giving me a two inch pile of documents for the Museum, and that's great.
TAYLOR: The column that I've written for almost three years, I'll ask Jancey to get copies of all of that, but that'll be a stock of about another 3, 4 inches. These, I can give you now, these are extra copies, I can give that to you. These are things, that up to this point, I don't have copies of, and you said you wanted copies of things.
PAGLIN: Shall I tell them that they have to make copies of this if they want it? I'm talking about Penn State, in their school's library?
TAYLOR: All right, yeah. I need to keep these, they need to be copied. It's a good pile to copy.
PAGLIN: Because it's a considerable amount. We wouldn't want to put you through that expense. I will tell them that we've got all this, and they'll say, "Oh God, we'd love to have this." And I'll say okay, but you've got to copy this and send it back. Right?
TAYLOR: Yeah, I think some of this, well, for example, here's one that I gave at IEEE international convention in 1969, entitled "The Future Wire Distribution of Radio and TV Broadcast".
PAGLIN: What's that, you know, what's that? That's absolutely invaluable.
TAYLOR: This is kind of fun because I predicted in 1969 the growth of cable up to 1980.
PAGLIN: How close did you come to it actually?
TAYLOR: I've got a figure somewhere that shows, well we're pretty close to the median line, we haven't been up as high as the high.
PAGLIN: Well, I will take these and tell them that they're invaluable. It'll become part of this entire collection of the oral histories of the Cable Television Pioneers at Penn State which I think is going to be a very, very significant contribution. It is the first time, frankly, that anybody has decided to do this, as we have, on an industry‑wide basis, where the inventors, the guys who made this cable thing go are still here. That's the point, because they have a story to tell for the future. So again, my thanks. This is the conclusion until I hear from you again. So I'll shut this off now. We have now concluded what will probably be the last interview session with Archer Taylor. It is now 12:25.
End of Tape 7, Side A