REMARKS BY COMMISSIONER JAMES H. QUELLO
          AT THE JOHN BAYLISS BROADCAST FOUNDATION ANNUAL BANQUET
                      NEW YORK, NY - OCTOBER 30, 1996

     Thank you, Paul Kagan, for that generous (humorous)
introduction.  It is always
gratifying to be introduced by a respected industry leader.  As
you know, Paul is a
noted research and management efficiency expert.  He is
frequently commissioned (fancy
word for employed) by industries to authentically illustrate
their superiority over
competitors.  He personifies an admirable research management
characteristic -- strong
loyalty to his employers.  I suppose this could be interpreted as
a reverse toast.

     So you expected eminent communication leaders like tycoons
Lowry Mays, Dick
Wiley, Preston Padden, Frank Wood and the distinguished
Commissioner Rachelle
Chong?

     Tough!

     You got me.

     Incidentally, I asked the Bayliss Foundation to take down
the names and
addresses of all regulated industries and communications lawyers
who asked for their
money back (long pause) -- naturally I was going to congratulate
them on their good
judgment.  Now if you believe that -- no -- my senior legal
advisor, Pete Belvin, insisted
that I strike "Now if you believe that" from the record, so I'm
not selling any bridges
tonight.

     Anyway, this was the week where I was so grateful to be
toasted on Sunday
(inducted into the Radio Hall of Fame) that I was willing to
undergo a demeaning
roasting on Wednesday for the Bayliss Foundation.

     Imagine my dismay -- my staff accuses me of an Academy Award
performance in
registering dismay -- when I learned only last Friday that the
Justice Department
ordained me as non-roastable!

     To my surprise (relief?), the Justice Department apparently
ruled it is illegal to
deliberately roast or criticize a government official in public
-- of course, this in no way
affects the many well-established subversive methods.  Also, it
certainly doesn't seem to
apply to Congressional Oversight Committees or the press, the
Courts or wives.

     The late decision was particularly surprising because I
thought the First
Amendment specifically gave everyone the right to criticize the
government or ridicule
government officials, including regulators.  In fact, even with
my old legendary exchange
with Howard Stern, I said he had a right to be wrong, a right to
ridicule government
officials, but, well, the rest is another story for another
place.

     Anyway providence interceded on my behalf.  Unlike you in
the audience, I now
have the best of all worlds.  I can roast without being roasted. 
Oh, kind fate!

     A leak from a friendly mole in the opposing camp warned me
that the main roast
attack would concentrate on my being branded as plaque-happy,
seeking every award
from every industry, association and university.

     I admitted to an editor recently that I haven't missed an
FCC meeting or an
award in over 22 years as an FCC Commissioner.

     But, I attribute my bumper crop of distinguished
pre-posthumous awards to the
venerability accorded advanced age.  My standard quote is, "With
venerability you get
credit for virtues you never possessed -- and I'm grateful!"

     I'm grateful too, that performing my duties in accordance
with my
reappointment slogan of, "Delusions of Adequacy and 75% of My
Marbles -- A Good
Norm in Washington!" has found such charitable widespread
acceptance in the form of
awards,  commendations, and even roast invitations.

     However, being a fugitive from the actuarial law of averages
isn't all beer and
skittles or awards and commendations.  Going from the Pepsi
generation to the Pepcid
generation, or -- even more disconcerting -- going from the
golden years to the very
senior platinum years, has its problems.

     I now gracefully accept a well-meant greeting with
reservations.  You may have
heard that I'm now greeted like many in the advanced stage of
life -- you know the
three stages -- youth, age and "you look great!"

     I feel reasonably great, but I don't take three-year
subscriptions and I don't store
green bananas.  But I don't feel age is a problem for me.   I
like to think that
everything I did years ago, I can still do today -- well, almost
everything.

     You may have heard an updated version of my old saying: 
"Anyone who says he
can do at 80 what he could at 40 wasn't leading too exciting a
life at 40."  In  fact,
whenever I goof at home, my wife Mary threatens to turn me in for
two 40s -- and when
really annoyed, she warns, "You will never make our 60th, Jimbo." 
However, we did
observe, or I would like to say celebrated, our 59th anniversary
last September -- a
rousing tribute to her sense of humor and a source of
astonishment to my close friends.


     Of course, I believe in marriage.  If it weren't for
marriage, some men might go
through life thinking they had no faults at all.

     One of the mixed blessings of advanced senior citizenship is
you no longer have to
avoid temptation.  Temptation avoids you.

     I recently regaled FCBA members at a luncheon confessing
that with the
involuntary celibacy of the golden years, I now read Playboy
Magazine for the same
reason I read National Geographic -- to see fascinating places I
never get to visit.

     As my tennis partner, Dick Wiley, will attest, I still play
tennis every week.  I call
it my last desperate clutch at youth.  Now when I miss a tough
shot, I use psychology --
I yell, "When I was only 79, I would have killed that shot!"

     I also want to mention that I have developed a much stronger
ecumenical sense as
I grow older.  I now personally accept all religions because I
don't want to blow an
opportunity for some kind of merciful eternal salvation on a
religious technicality.

     But enough musings on the foibles of aging and grousings on
a questionable ban
on roasting.

     Now comes the part you all have been waiting for -- the
substantive speech.  This
substantive speech is being brought to you courtesy of the
government ethics rules which
stipulate that I must impart some words of wisdom to you to
justify my presence here.

     Now, if that doesn't convince you that government has no
business regulating
program content, nothing will.

     So, I agonized over this speech, now it's your turn.

     I cast about for something timely and found my stimulus from
a source that's
elicited response from me in the past -- namely, several opinions
the FCC Chairman
expressed recently.  In his remarks to the International Radio
and Television Society
earlier this month, the Chairman teed off on several major
current issues with
perspectives that, I think, warrant some further comment from
other Commission
sources.  Incidentally, I reminded Reed, like I used to remind
former Chairman Mark
Fowler, that I agree with him 95% of the time.  Reed used the
same rejoinder -- that
the other 5% comprised the major issues!  But as you will see, we
are in substantial
agreement with minor variations on some major issues. 

     So, here goes.

     In the IRTS speech, Chairman Hundt criticized the recent
partial stay on the
Commission's interconnection rules imposed by the Eighth Circuit
in Kansas City.  As
he has on previous occasions, Reed categorized the decision as a
"grievous error" and an
"astounding piece of judicial activism" that "has the potential
of Balkanizing
competitive policy by encouraging fifty different approaches to
how we get competition." 
Tough timely statement, but I would recommend a more conciliatory
approach.

     When it comes to our interconnection rules, the states and
the court are not the
only bash-ees and Reed Hundt is not the only bash-er.  With the
imposition of the stay,
we have also been criticized by some members of Congress, taking
us to task for
apparently missing the point in implementing these key provisions
of the 1996 Telecom
Act.

     A couple of observations about this situation:

     First and foremost, on major common carrier matters, the
Chairman and I agree
much, much more often than we disagree.  And surely I -- and
indeed a unanimous
Commission -- agreed that the interconnection rules we adopted
were not  only
consistent with the Telecom Act but also constituted a fair and
effective roadmap to
generating competition in the provision of local telephone
service.

     This Commission acted in good faith and to the best of its
ability to implement
the law.  We tried to do what we believed was expected of us,
and, to be fair, the parties
aggrieved by our decision did no more than what was reasonably
expected of them in
vindicating their interests by filing their appeals.

     I do not consider it a personal affront if the parties
disagreeing with FCC
decisions fully pursue the legal recourse open to them -- just as
I would do.

      But if, for at least some period of time, key provisions of
our interconnection
rules cannot be implemented, the common focus of all parties --
the Commission, the
states, and the Congress -- should be on collaboration, not
castigation.  Rather than
strewing blame on each other in the wake of the Eighth Circuit's
decision, we should be
working collaboratively on how we can proceed now, despite the
stay, to create the
competition in local telephone service that is such a critical
element of the
Telecommunications Act.

     Needless to say, the court's stay also makes implementing
universal service and
access charge reform -- the other major policy initiatives in the
common carrier area --
a lot more difficult, too.

     So much for common carrier issues for the time being.   Now,
on to mass media
issues, where Reed and I tend to agree, shall we say, a bit less
frequently.


     The Chairman's IRTS speech contained a number of statements
on digital
television that seem somewhat inconsistent.  On the one hand, the
Chairman argues
against any Commission rules on such matters as, for example, the
hours a station
would be required to broadcast in high-definition format because,
as he put it, "My
fundamental assumption is that the last thing we need to do is
adopt rules that will
burden the digital businesses before the business even starts." 
Yet at the same time, in
the same speech, he also calls for the set-aside of "a modest 5%
of programming time on
digital TV [for] educational TV, free time for political debate,
and other public service
programs."

     So here's the dilemma:  If it's bad policy for government to
prescribe the hours
of programming a digital television broadcaster must present, why
is it good policy for
government to prescribe the content of programming a digital
television broadcaster
must present? 

     The answer that would probably be given is that educational
TV and political
debate are meritorious programming that should be presented to
discharge the
broadcaster's public interest obligations.  But this answer
assumes that EVERY
broadcast medium -- digital and analog, terrestrial and satellite
-- MUST present a
stated quota of this programming in order for the broadcaster in
question to fulfill its
public interest obligation.

     Needless to say, I don't share that belief.  I share it even
less in the context of a
brand new, untried technology which has zero audience share and
which can only find
acceptance in the already highly-competitive video marketplace by
presenting a mix of
services that its potential audience will accept.

     In this sense, I believe that, as broadcasters spend the
tremendous amounts of
capital that will be necessary to convert to this new service,
the Commission ought to be
more reluctant, not more eager, to burden these new channels with
additional
programming edicts.

     The Chairman defended his proposed program prescriptions by
noting that the
court has upheld the Congress' imposition of similar obligations
on DBS providers.  I
suppose the short answer is to say that, even if the court's
opinion could be construed to
make it legal to do what the Chairman wants, the case says
nothing whatever about
whether it would be sensible to do it.  Also, DBS is a relatively
new distribution service,
unlike broadcasting that already has a longstanding requirement
and tradition of
serving the public interest.

     One final note on this subject:  there is an unavoidable
"cart-before-the-horse"
problem in talking about regulating digital television channels
before we've even created
them.  And this we have yet to do -- notwithstanding the fact
that, after eight years of
intensive inter-industry work by leading communications engineers
and executives, the
Advanced Television Advisory Committee made its recommendation on
a digital
television transmission standard to the Commission almost one
year ago.

     I have called for an item to be presented to the Commission
at its December
meeting that will enable us to finally settle this issue of
selecting a digital TV
transmission standard and thereby let digital television -- with
or without program
quotas -- to get started.  The manufacturers, communications
unions and broadcasters
all need the certainty and stability of establishing a standard
now.

     Finally, let me touch on one more current issue that the
Chairman raised in his
IRTS speech:  the subject of liquor advertising on television. 
On this he stated that,
"it's hard to see how the public interest would be served by this
new and alarming
addition to the advertising sea that now washes over us."

     I tend to agree that liquor advertising, particularly ads
appealing to young
people, could raise a public interest question, and I would even
be interested in seeing
the ads.

     However, this is a very troublesome area for two very
different reasons.

     First of all, surely none of us would argue that alcoholism
has always been, and
remains, a profound societal problem -- indeed one that, in one
way or another, has
probably touched the lives of every single person in this room.

     At the same time, however, distilled spirits are a legal
product, and liquor
advertising, like other forms of advertising, would be regulated
in the first instance by
the Federal Trade Commission, not the Federal Communications
Commission.

     So, I guess my question is, exactly where are we going with
this and how do we
plan to get there?

     If we are talking about the FCC somehow trying to regulate
televised liquor
advertising, that strikes me as probably stretching our
jurisdiction too far.

     If, on the other hand, we are talking about some advisory or
similarly
constructive role in conjunction with action by either the FTC or
Congress, then that's
something else.  But, in the meantime, to suggest that the FCC
has some sort of
independent authority itself to regulate liquor ads on television
seems problematic.

     Nevertheless, I find it hard to criticize the Chairman for
perhaps trying to fire a
warning shot across the bow.  For, unless memory fails me, I
remember that I myself
exhorted broadcasters on numerous occasions to voluntarily
curtail the amount of
gratuitous violence on broadcast TV.  They didn't, and the V-Chip
legislation was enacted.  I think it is time for the liquor industry and
broadcasters to re-activate
voluntary self regulation.

     Perhaps this time, at least, a word to the wise will prove
superfluous.

     My final observation on regulating either the program
content of nonexistent
digital television channels or liquor ads on TV is that the FCC
would hardly have spare
time on its hands if we just focused our limited resources either
on issues that already
exist or on issues that are clearly under our jurisdiction. 
There are plenty of these
matters that are vying for our attention.  For example, we will
still have contentious and
complex issues like television, radio and newspaper
cross-ownership, cable television
leased access rates, universal telephone service, access charge
reform, making enough
spectrum available for public safety radio uses, further spectrum
auctions and literally
hundreds of other problems.  In every single area of
telecommunications we regulate,
there are resource-intensive issues that have to be resolved. 
There is an abundance of
speech material in any one of these contentious issues, but for
some future time and
place.

     Now for the piece de resistance.  Surely even the grinches
in the government
ethics office wouldn't begrudge my taking a couple of shots at
the distinguished folks on
the dais.

     Let's take tycoon Lowry Mays.  I first met him 22 years ago,
a nice Texas A&M
country boy, when he had 2 radio stations and 2 Texas bankers. 
Right from the start he
never saw a radio conglomerate he didn't love or acquire.  At
last count he had an
impressive (or overwhelming) 103 radio stations, 18 TV stations
and he has now gone
international.  He doesn't claim he is a self-made man, he
wouldn't deny God that
privilege.  He is so impressive that he now talks to God
regularly, not in prayer, but on
a one-to-one basis.

     How about Dick Wiley, the Lowry Mays of communications law,
with a semi-
monopoly of legal clients and legal talent.  As FCC Chairman, he
believed that if you
"Heard No Evil, Saw No Evil, and Spoke No Evil," you would be a
defenseless
Commissioner and a lousy lawyer.   Dick recently started to make
known that he is a
proud graduate of Northwestern -- nothing to do with their
improved academic
standing.  Incidentally, Dick never played football for
Northwestern -- back in those
days, no one wanted to admit it.  But he did play varsity
baseball.  I was told he was a
good fielder but had only one weakness as a hitter -- a pitched
ball.  Anyway, Dick
made a smooth transition going from a kissee (Chairman) to kissor
(lawyer-lobbyist).

     Frank Wood -- They threw away the mold when they made Frank
Wood -- and
even with only one, the supply way exceeds the demand -- so said
his competitors
wounded by his "fire up" style of management.  His former
employees who are now
resisting being "fired down" by consolidation of acquisition
state that, "Hell hath no
fury like Frank missing a radio buy in his market."  I hope Frank
believes in
reincarnation because he deserves another opportunity to make
amends and come back
to earth as a low pressure, considerate, introspective mensch.

     Preston Padden is an earnest executive of many talents whose
primary objective
in life is serving the public interest and being a Creature of
God, loved by his fellow
man.  I know.  I heard it first hand because he told me so
himself.  With the Fox
influence, I understand he is being nominated, not for an Emmy
but for a distinctive
new award -- the "Hammy."  He concentrated so hard that he seemed
a little spaced
out, so Rupert put him in charge of the huge satellite service.

     And, finally there's Commissioner Chong.  I suffered an
early and embarrassing
defeat at her hands on a little fraternity-type hazing I tried
when she was new to the
Commission.  The story will appear in my book, but it is not
quite appropriate for a
public gathering.  When it was over, she bounced into my office,
laughed and said,
"Don't fool with me, I'm a mean Mongol!"

     The perky Mean Mongol is no a poster kid for big government
either.  In a
recent speech, she had some original interpretations for familiar
FCC initials.  She
quipped "NPRM (Notice of Proposed Rule Making) stands for,
'Nothing Proceeds
Regardless of Merit'" and "NASA (National Aeronautics and Space
Administration)
means 'No Available Spectrum Anywhere.'"

     I liked Rachelle's definitions much better than my initial
definition of the FCC 22
years ago, even though it proved true -- FCC stands for "From
Crisis to Crisis."  I also
used a phrase 21 years ago that has become a standard -- "The
three greatest lies in the
world are:  (1) 'It's great to be poor, it builds character;' 
(2) 'The check is in the mail;'
and (3) 'We are from the FCC and we are here to help you!'" 
During our deliberations
on the initial over-regulatory three-hour children's television
proposals, I thought of
replacing the No. 3 lie with "The era of  big government is
over."  Fortunately, some
reasonable flexibility at the 11th hour made it unnecessary. 

     I hope we are all good enough friends that I can get away
with all I just said. 
You are an impressive, respected group of industry leaders and I
was honored by your
presence -- Lowry, Dick, Frank, Preston and Rachelle, thanks for
being here.  I sensed I
ran the entire gamut of your emotions from A to B.

     Thanks to all of you for your attendance and for the
courtesy chuckles.

     May the Lord be with you, but not too soon!


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