Business & Finance: Aerial Chaos

The first radio "piracy" case fizzled last week in Chicago. The Zenith Radio Corporation (WJAZ) of Chicago, hampered by Secretary of Commerce Hoover's administrative regulation that it have only two hours' broadcasting time each week, decided to make a test case of his authority. They deliberately prolonged their broadcasting time on their licensed wave length (322.4 meters; also that of General Electric's Denver Station KOA), and deliberately used the wave length of Canadian stations.

If WJAZ could snatch without restraint at any wave length it pleased, other stations could do the same. Aerial chaos would result. So radio listeners with $500,000,000 to $600,000,000 invested in receiving sets waited for a court decision. More anxiously waited the radio manufacturers and broadcasters, who realized keenly that broadcasting must be constant over wave lengths and time.

Thus the Zenith people were arraigned for criminally violating the Federal statute of 1912 on the subject, and the only one. This statute regulates the licensing of manufacturers, producers and experimenters in radio, gives little discretionary powers to the Secretary of Commerce over regulating broadcasting, provides few regulations in itself. This statutory lack Secretary Hoover has filled by his administrative orders, among others the assignment of wave lengths and of broadcasting hours.

Federal Judge J. H. Wilkerson decided that, as the Zenith people had been licensed regularly, they had committed no crime. Neither was their violation of the administrative regulations a crime. He carefully avoided a construction of the Congressional law (the statute of 1912) dealing with the subject, which might render that law unconstitutional. Thus the conditions remain undecided, unchanged, although sentiment seemed coalescing to make more detailed the statutes or to make more effective Secretary Hoover's regulations.