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1952 - 1957:

Times of Change: Tom O'Neil Takes Over

Frank White's three-year contract with Mutual was up for renewal in the spring of 1952, and with the changes in MBS ownership, it was known that White and new MBS chairman Tom O'Neil were at odds as to just what White's future role would be.

So in a move that didn't come as a complete shock, White resigned. In a closed-circuit talk to affiliates, White called his decision "a most difficult and trying one," saying there were "considerations on both sides which have blocked Tom and me in our many friendly talks." But White's departure was without rancor, as he and O'Neil spoke highly of each other in announcing the change.

With White's resignation, Thomas F. O'Neil took over as MBS president. O'Neil was already the man in charge, as he was the head of Thomas S. Lee Enterprises (the holding company which controlled the radio and TV interests of General Tire and Rubber), which owned 58% of Mutual.

Up until then, Mutual by-laws restricted any single entity from owning more than 30% of MBS stock. That rule was eliminated at a February 1952 meeting of the MBS board. But the real question was whether Mutual's operations would be affected, especialy in light of O'Neil's view that a four-network landscape was economically unfeasible. But two months later, O'Neil assured affiliates that Mutual's format would not change, predominatly composed of relatively small stations, mostly in non-metropolitan markets, with an emphasis on acceptability and flexibility.

O'Neil moved quickly to combine some Mutual operations with WOR's. On the programming front, he also made a major splurge to expand big band remotes.

The Mutual operation was in good shape as the 1952-53 season got underway, a marked contrast from the other webs. The main reason was its grass-roots setup. There were several factors: most of its 550 affiliates were the only network station in town; most of them also had no competiton from TV. MBS' rates were also the lowest in network radio (stemming from a large number of "bonus" stations), meaning a good buy for the advertiser. As a result, Mutual's billings showed a 13 percent increase.

Meanwhile, the other radio networks were slashing their rate cards as TV cut into their audience and their ratings sank. Mutual followed suit to a point, cutting nighttime ad costs by about 25 percent. But MBS went only so far: rates in areas with TV competition were cut more than in areas without it.

But Mutual faced a problem: how to develop stronger programming in a climate of declining sales and increased TV competiton? This was the dilemma MBS management and the Mutual Affiliates Advisory Committee (MAAC) met to solve at an infamous meeting on Cape Cod in June 1953.

The "solution" put some affiliates in open revolt against the network.

The "Cape Cod" Plan

At Cape Cod, affiliates heard that Chesterfield cigarettes would sponsor Perry Como for a three-a-week quarter hour at 7:45 p.m., Chesterfield's first business with Mutual. Coming as a follow up to MBS' acquisition of Eddie Fisher's twice-a-week "Coke Time" (transcriptions from his Coca-Cola show on NBC-TV), the MAAC was in a mood to explore what could be done to further upgrade the network's programming.

The plan that emerged, in essence, was barter: affiliates would air five hours of network programming daily; in return, Mutual would provide (in lieu of monetary compensation) 14 hours of free programs each week for stations to sell on their own (over and above the regular co-op and sustaining programming).

O'Neil promised that the money withheld from stations under the new plan would go into a pool for program upgrades. MBS invested $1,000,000 in the free co-op shows, including Basil Rathbone in "Bulldog Drummond," Peter Lorre in "Nightmare," "Counterspy," and the return of "Mr. District Attorney." In addition, there were news strips with Frank Singiser and H. R. Baukhage; and "Spotlight Parade," six five-minute weekday strips featuring Duncan Hines, Fred Robbins, "Senator" Ed Ford, and Arlene Francis & Bill Cullen.

The FCC gave its OK to the plan, and it went into effect October 1, 1953. But while Mutual reported that stations representing 75% of the MBS rate card had gone along with the new plan, discontent was growing: MBS affiliates in Iowa unanimously turned it down; Maryland stations rejected it, were wooed in by Mutual, then were unhappy again. Opposition was heavy in Oklahoma, Missouri and Michigan. And reportedly, Chicago's WGN wasn't totally happy, either. The reluctant affiliates even threatened to split off and form a new network of their own.

By November, MBS had raised the white flag, shelving the plan effective December 31, and going back to the terms in effect before the plan started. But the stations who had opposed the plan showed little inclination to boast, saying they'd work with the network to work out something better. O'Neil, speaking to the affiliates in January 1954, promised, "The Cape Cod plan is dead. I have no plan to offer."

But the idea of substituting free programs for cash compensation was a clear sign that Mutual was anticipating trouble ahead.

Mutual found itself in hot water in Spring 1954 over a decision to let H. L. Hunt's conservative "Facts Forum" organization take over production of its "Reporter's Roundup" for $350 a week, with moderator Everett Holles replaced by Robert F. Hurleigh. The switch to FF resulted in Mutual newsman Joseph McCaffrey to resign, other newsmen to look for work elsewhere, and guests to walk out on other programs. Two affilates, including WWDC Washington, refused to carry "Roundup." The dustup also sparked unfounded rumors that Hunt was aiming to buy Mutual, which were hotly smacked down by both Hunt and O'Neil.

Come Fall of 1954 - Mutual's 20th anniversary. On one hand, the only thing to celebrate may have been that MBS had made it that long. Some reasons:

But on the other hand, there were some happier things to point to: with its heavy affiliation base in non-tv areas, MBS' share of network radio billings had increased steadily since 1950, from 8.8% to 14.9% (for the first six months of '54) - times when the other networks were showing signs of decline. Also, MBS' sales were up almost 30% since 1950 (but 1954's sales were off almost 12 percent from 1953).

So the network planned a celebration in October 1954. It got a helping hand from Illinois Governor William Stratton, who proclaimed October 3-9 "Mutual Broadcasting System Week" in that state. The anniversary centered around the theme, "MBS nails down America," stressing that the network's 572 basic and bonus affiliates blanket nearly all the U.S. A one-hour "Cavalcade" stanza was planned, giving a rundown of Mutual's "services to America." A series of special announcements called "There's a Familiar Sound" highlighted past Mutual programming. Special photographic and printed matter was prepared for newspapers.

But at a testimonial luncheon marking Mutual's 20th birthday given by the Radio & Television Executives Society, MBS President Tom O'Neil wanted to look forward - and wasn't entirely optimistic, saying networks had to change its ways in order to survive: "We have to bury the past. This means a reappraisal on the basis of where our listeners are, what type of people are included in these listeners and what have been their changing patterns because of the inroads of television."

"Conditions have changed," O'Neil said, "and I believe that the networks will change with them. And with all parties necessary to a successful change will cooperate fully, no one has to wonder about the future of radio networks."

Mutual felt the answer to its future lie with sports. Nearly always able to attract coin to its past sports programs, Mutual put together an umbrella nighttime sports program for its post-9 p.m. slot four nights a week. "Parade of Sports" featured college basketball, pro basketball and hockey and other miscellaneous events from Madison Square Garden. It was designed for co-op sponsorship, so both the network and its affiliates could share in the sponsorship coin. But it didn't last long, for whatever reason; "Parade" had marched off the MBS schedule by May.

By mid-1955, Mutual was clearly feeling the crunch of TV (and the early success of NBC's weekend "Monitor" series), and was deep in the planning for what it called a program and sales "revolution." When it was announced in November, it was no less than a total overhaul of the network. The program decks were cleared for what was termed "companionate radio," and much of the behind-the scenes decks were cleared, too.

Three MBS vice-presidents were fired, the station relations department was deemphasized, as was co-op programming; more than half of the steno pool was dismissed; half the mail room staff lost their jobs. 19 network engineering jobs were cut. The thinking was that without a sister TV network to bear the financial weight, Mutual could no longer afford an extravagant staff.

The only departments spared the cuts were programming and sales. "Companionate radio" had three things in common: 1) a large block of time; 2) a single host (or two, in the case of Bob and Ray), although portions would be dramatic or canned material; and 3) each block would be casual.

"Stand By! Bob and Ray" ran weekdays from 5 to 6 p.m.; "Stand By! Sports" consisted of play-by-plays, scores and sports info from Harry Wismer Saturdays from 4 to 6 p.m. "Stand By! Round the World," a two-hour Sunday night variety stanza, was hosted by Frenchman Jean Lamont. Similar blocks were set for weekday mornings, early afternoons and evenings, but never happened because, aside from "Stand By! Bob and Ray," they couldn't draw much advertiser interest. Mutual's only commercial success at that time continued to be with the old regulars - "Queen for a Day," the evening mystery block and a few others. It created a tug-of-war within the network - those in favor of keeping the old program structure against those wanting the "Stand By" departure.

With network revenues down, MBS started looking toward cutting its program service, and spent much of 1956 trying to get affiliate support for a new contract, which included a reduction in total network option hours from 60 to 35 a week. But another major change included elements from the "Cape Cod" plan: stations would have to pre-clear and waive payments on two-and-three-quarter hours Monday through Friday, one hour Saturday and two hours Sunday.

By that time, one of Mutual's founding four announced it was checking out: Chicago's WGN said it would go it alone as an independent station once its Mutual contract expired August 31, 1956. A big reason for that concerned WGN's contracts with talent and musician's unions. But WGN's contributions to Mutual had been virtually nil for about a year.

WGN's exit followed that a year earlier of another founding station, WLW Cincinnati. The stated reason: "a basic disagreement on policy matters." But Variety reported that it came down to money - and how much compensation WLW would be paid for airing Mutual programs. Through the years, WLW had kept a dual affiliation with NBC. But it had commanded a much higher price - through rate cards and percentage of network billings - from both networks than other affiliates could receive. However, with the downturn in network billings, the station could no longer get Mutual to come across at the old price.

WGN's departure sparked conversation in the trade about Tom O'Neil's future stake in broadcasting, particularly Mutual. In addition, Mutual's reported 1956 losses of $1.5 million didn't help matters.

It wouldn't be much longer until O'Neil let his feelings be known.

Some information on this page came from various issues of Broadcasting and Variety.

Text copyright © 2009 Kenneth I. Johannessen.

No challenges to logo, sound or image copyrights are either inferred or implied.

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