Thomas H. Wyman, the new president of CBS Inc., has decided to lead an assault on long-standing federal rules that limit the right of commercial television networks to own and syndicate the programs they show.
Persuading the Federal Communications Commission to overturn the 12-year-old rules "is the No. 1 subject on the agenda, in financial and conceptual terms," Wyman said in an interview this week. "Simply put, I can't think of another subject more clearly limiting our ability to operate our business as we know it."
With major networks losing viewers in increasing numbers to cable program networks and pay television distribution systems, Wyman thinks the networks' survival as strong competitors is dependent on their ability to own and market programming however they see fit.
For example, Wyman said CBS would like to take the over-the-air performances of artists like Barbra Streisand or Neil Diamond, and market the audio product both as video discs or tapes. "That is the way the industry should work," he said. And CBS would like to profit from syndication of hit series like"M*A*S*H," "Dallas" and "All In the Family." The FCC rules now prevent that.
Wyman, the hand-picked successor to CBS Chairman William S. Paley when Paley retires next April, has been reluctant to speak out on the company's future plans since the September succession announcement, choosing instead to let the transfer of authority within the company evolve quietly.
On the other hand, he left little doubt in a conversation this week that he would lead CBS aggressively in challenging the regulations, known as the financial interest and syndication rules.
The rules bar CBS, NBC and ABC, from syndicating the shows they broadcast and from acquiring broadcasting interests in any rights to programming other than what is displayed on the networks themselves.
In challenging the rules, Wyman will be placing himself directly in Hollywood's line of fire.
"It is a fascinating subject, worth hundreds of millions of dollars," he said. "But it is also an important human and corporate drama. There is clearly something very serious and confrontational going on between groups of people who have a great deal of business to do with each other. The decibel level will pick up sharply from here to the 15th round."
"The appeal of the networks and the ability to compete with alternative distribution techniques will be sharply impeded" within the next five years if the rules are not lifted, Wyman said. "The ability to merchandise and distribute the programs we make is our biggest problem and our biggest responsibility in the era before us.
"The survivors will be the networks that go with the best material," he said. "Now, we can't corral the creative talent . . . Our ability to compete for material is being squeezed hard."
In Wyman's view, CBS risks tens of millions of dollars in airing new series, and although it ultimately benefits from rising advertising revenue when a show is a hit, it gets nothing down the road from making a show such as M*A*S*H a champion in rerun viewing outside CBS.
M*A*S*H "did not pay its way for two years," Wyman said. "Unless we popularize a program, there is no syndication, but after we do, its possible for somebody else to get a 42 percent share for M*A*S*H reruns. Somebody has to say that doesn't seem fair.
"We don't have a reactive position," he said. "We are today aggressively in favor of alternative distribution ideas. The network share will be reduced and it's a good thing in its largest terms. For the public, it's a chance to see more and make more choices."
But the public, according to Wyman, "shouldn't have stuff taken from free television and have to pay for a lot of it only because of a regulation that is destructive and not required."
The rules were put in place, in large part, to open up competition in the creation and distribution of series, in particular, and, according to their advocates, have resulted in the development of a healthier programming market.
Top executives from the broadcasting and film industries are gearing up for a bitter confrontation next year over possible repeal of the rules.
At CBS, for example, a team of top economists and communications lawyers has been brought in to help prepare CBS's comments to the FCC, due at the end of January. FCC action is unlikely before late spring or summer.
The CBS team includes former FCC chairman Richard Wiley, now an attorney in Washington with Kirkland & Ellis; former Carter administration official Alfred Kahn; Brookings Institute economist Robert Crandall; Roger Noll of the California Institute of Technology, and Cravath, Swaine and Moore attorney David Boies, a leading antitrust specialist.
"The campaign we're mounting is very much an extension of Wyman -- low key and scholarly, no hard sell," said William Lilley III, CBS vice president, corporate affairs.
Both NBC and ABC are also gearing up for the January filing date, but little has been said publicly about strategy. Their management's have yet to take visible positions.
NBC, however, has hired well known lobbyist and publicist Robert Gray's Washington firm, Gray & Co. just to handle the matter. ABC, too, is beginning to move, and is working with Timmons and Associates, a Washington lobbying firm.
On the other hand, Hollywood's studios and syndicators are mobilizing for the fight.
A group called The Committee for Prudent Deregulation has urged in trade publication advertisements that writers and producers join in an effort to keep the rules intact. "If the networks win," their advertisements say, "you lose. A lot."