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ALLIED NO' TO ARBITRATION; WITHDRAW FROM DISCUSSIONS Board Decides to Gather Evidence on Violations Of Decree Provisions NEW ORLEANS—The board of Allied States Ass'n at its winter meeting here said "no" to the proposed industry arbitration plan for the second time, and ordered its representatives in the trade discussion to withdraw. Thus, the directors reaffirmed the action of the national convention held in Chicago several months ago. SNAPER SOFTENS THE BLOW Wilbur Snaper. Allied's president, softened the blow .somewhat by i.ssuing a subsequent statement in which he declared the a.ssociation had not closed the door to further discu.ssion of grievances with distributors, but that further discus.sions would have to be outside the framework of any arbitration plan. Tlie two-day se.ssion of the board, preceding the annual convention of the Gulf States Allied group, was a militant one. In addition to the arbitration stand, the directors okayed the following action: 1. The association will go ahead with a plan to gather evidence nationally of law violations in connection with film pricing and distribution with a view of presenting the findings to the appropriate government agencies. This is in accord with the resolution presented to the Chicago convention by John Vlachos, president of the Michigan Allied group. 2. The board bitterly scored the expanding policy of playing pictures on prerelease policies and using this practice as a means to demand terms which required increased admission prices. This procedure. Allied contended, violated two of the injunctions entered against the distributors in the decrees. 3. Directors took note of the recent sale of 104 films to television by Republic and said that such a policy if continued by that company and adopted by other distributors could be "disastrous" for theatres. The board warned that the constant appearance of the Republic name on television may in the long run associate the name with free film entertainment and establish a public reluctant to pay for Republic pictures at the boxoffice. TURN DOWN FILM PRICES The decision to turn down arbitration was reached Eric Johnston, president of the Motion Picture Ass'n, made it plain the distributors would not consent to arbitration of film rentals. At the same time Johnston, in a letter to Snaper. said the distributors were willing to enter into discussion with exhibitor groups but the MPAA said that in- (Continued on Page 10) Sfatement on Arbitrafion Decision NEW ORLEANS—The board of Allied States Ass'n issued the following statement on its arbitration stand and protest to certain trade practices which it contends violate the antitrust decrees: "The board of directors having heard and fully considered the report of President Snaper in reference to arbitration and the letter from Eric Johnston on the subject is forced to the conclusion that these communications contain no proposals within the scope of arbitration or otherwise which would afford the exhibitor any relief from the distributor's pricing policies and practices which constitute the exhibitor's principal grievance and stand as a bar to the economic recovery and future welfare of the motion picture business. HIT AT PRERELEASE POLICIES "The condition is aggravated by the fact that during the negotiation looking to the establishment of an arbitration system the participating distributors not only continued to exact higher film rentals from the exhibitors on all classes of product, but designated for special treatment as roadshows or prereleases during that period more pictures than had been marketed by that method in five preceding years and this in spite of the fact that in the beginning and throughout the negotiations the exhibitor representatives of their organization affiliations cited that method as the chief source of complaint and strove for effective measures for curbing it. "The Allied board at this critical Juncture James Grainger Looms As RKO's President Hollj-wood—What appeared to be one of tlie principal stumbling blocks in negotiations for James R. Grainger, Republic sales chief, to switch over to RKO Radio as president of the latter company, appeared to have b e en eliminated on Thursday (151 when Herbert J. Yates, Republic president, withdrew any objections to the move. RKO spokesmen James R. Grainger then expres.sed confidence that by week's end Grainger and Howard Hughes, RKO board chairman, would issue a joint statement announcing the signing of the contract and plans for the future. in the industry affairs objects to the film companies insisting upon retaining and increasing a practice which in its practical effect violates two of the injunctions entered against eight of them in the antitrust suit brought against them by the United States and has the further effect of withholding choice films from exhibitions in thousands of theatres at a time when mass attendance is so badly needed not only as an immediate .source of revenue but in order that the people may see and enjoy those films and recreate and re-establish the moviegoing habit. POINT TO CLEARANCE CHANGES "In order that there may be no mistaking our meaning when we say that the prerelease or roadshow method now being u.sed by the distributor violates court orders we point out the effect upon the regular clearance to which subsequent run theatres are subjected and additional and much longer clearance in favor of the prior run theatres which play the pictures first as a roadshow and then on regular release and has the further effect to create clearances over theatres and towns which have not heretofore been .subjected to any clearance. This extended clearance is not designed reasonably to protect the licensed theatre on the run granted it but is designed solely to increase the distributors revenue—a yardstick which the courts have said they may not use. "In addition, this method of marketing pictures presumes that the exhibitor shall increase his admission prices to an amount designated by the distributor and this usually almost invariably follows and constitutes the fixing of admission prices by agreement between the distributor and the eshibitor. "In the circumstances the board has no alternative but to reaffirm the program agreed to in Chicago which was to reject the distributor draft of arbitration plan and withdraw the officers from further participation in the negotiations." Snaper Again Elected Allied's President NEW ORLEANS—Wilbur Snaper. who was elected president of Allied States Ass'n last year after several years as a New Jersey Allied leader, was chosen to head the national a.ssociation for a .second term this week. He operates a circuit of theatres in New Jersey. Others elected included: Abram F. Myers, chairman of the board and general counsel, a post he has held from the date of Allied's organization: Ben Marcus, treasurer, who is an Allied leader in Wisconsin: John M. Wolfberg. secretary. Rocky Mountain Allied chief: and Stanley Kane, recording secretary, who is executive secretary of North Central Allied. BOXOFnCE January 17, 1953

INDUSTRY READY TO PUT BEST FOOT FORWARD ON THEATRE TV All-Important Hearings Before FCC to Draw Many Top Figures WASHINGTON—Film industry witnesses will tell the Federal Communications Commission that six SF>ecial theatre television channels are necessary to give the public the full advantages to be derived from this new form of entertainment. The FOG'S theatre TV hearings will resume on January 26. In accordance with a Commission ruling, requiring all participants wishing to present witne.sses to file a list of such witnesses together with summaries of testimony, the industry and American Telephone & Telegraph filed their lists and summaries on the deadline day, Monday (12 1. TO OPPOSE INDUSTRY POSITION AT&T will enter strenuous opposition to the industry position. That company will claim that it can handle theatre television network transmission more economically, can be in a position to do it faster, and can manage the job without sacrifice of channels which it claims are needed for other purposes. F. A. Cowan, engineering staff manager, long lines department, will describe Bell facilities in detail and will contend they can meet the technical transmission requirements of theatre TV as specified by the theatre interests, including among others those specifications having to do with bandwidth, definition and linearity. Cowan will liken the AT&T ability to meet those needs with its performance in relation to needs of broadcast television, and will also argue that the Bell system companies have already had considerable experience with successful handling of theatre TV programs. He will describe tests of existing Bell facilities to determine their suitability for the ten megacycle transmission outlined by the industry and will give cost figures. ARGUE THE ECONOMIC SIDE The ability of the Bell system to integrate its theatre television transmission service wtih its other services makes possible important economies in operations, in engineering and in the use of frequencies, he will argue. It will also permit development of theatre TV networks sooner than would otherwise be possible. F. M. Ryan, radio engineer of the AT&T department of operations and engineering, will contend that the common carrier bands in which frequencies might be assigned for theatre TV use are needed for anticipated common carrier use. Diversion of portions of common carrier bands to any type of exclusive use, such as theatre TV, would reduce their ultimate capacity, he will say. M. G. Wallace, commercial operating engineer of the long lines department, will testify that the Bell System now has over 30.000 intercity miles of broadband facilities devoted to transmission of television programs, serving 113 TV stations in 70 cities and also utilized for theatre TV. He will say that AT&T BOXOFnCE January 17, 1953 Arthur Mayer .^. H. Fabian Truetnan Rembusch Kmanuel Irisi li To Present the Industry's TV Cose to plans to expand these facilities to meet increasing requirements. The film industry will counter with more than 30 witnesses, with Eric Johnston, president of Motion Picture Ass'n of America, giving a general outline of the reasons the industry seeks specific frequency allocations, potentials of theatre television, probable effect on the industry's economic and financial position. Spyros P. Skouras, president of 20th Century-Fox, will testify that there is a need for exclusive theatre television channels in order to insure competition within the service itself. Census Bureau Plans Wide Industry Survey WASHINGTON — The Census Bureau plans to learn for the first time such things as number of double features, age of film theatres, costs of theatre television programs and number of showings during the year in a new census of the film industry now in the planning stage, it was learned Monday (12). The new census of the film industry, part of a general census of manufacturing and business, is expected to be the most complete yet undertaken. There will be two separate questionnaires. One will go to production, distribution and service companies, with the other going to exhibitors. Tentative forms already have been sent to MPAA, TOA, Allied and other industry groups for comment. Actual mailing will not be undertaken until at least the end of this year. It is not anticipated that any results will be known before the end of 1954, at which time they will be far from complete. The complete story will not be published, it is believed, before mid-1955. the FCC Wilbur Snaper atid as between theatre TV and other services. Mitchell Wolfson, past president of the Theatre Owners of America, a TV station licensee and one of the first to install theatre television, will tell FCC that theatre television will not deprive home television of anything, but will make available to the mass American public for the first time new entertainment and cultural opportunities. Wolfson also will say many attractions are not now practical for viewing on home television, such as entire plays, operas, ballets, and that these can be presented on theatre television. He also will cite possible use by state, local and federal governments of theatre television conducted successfully by the Federal Civil Defense Administration in the use of TV for training programs. Channels of sufficient number and width must be provided if theatre television is to realize these potentials, he will contend. Theatre television is but a logical development of the film industry's constant search to improve the quality of its product and methods for its distribution and presentation, according to Wolfson. S. H. Fabian, chairman of National Exhibitors Theatre Television Committee, will discuss the organization and operation of that group and its cooperative efforts in conjunction with MPAA. As another pioneer installer of theatre television, he will attempt to .show from his own experience why theatre television requires and should have its own assigned frequencies. Theatre television must produce a picture comparing in quality to that obtained from 35mm film, largely because the public would be dissatisfied with anything inferior, he will point out. Fabian will go into reasons why the industry asks six channels. Six chamiels would supply more competitive systems than there are currently in either radio or television networks. Exhibitor experience indicates that the greatest number of first run attractions ever being shown at one (Continued on page 10)