Communications Act of 1934

The Radio Act of 1927

By the early 1920s radio was a worldwide craze. Public demand for receivers was high with technology available to nearly everyone to make their own home-made receiver. New radio stations were signing on at a rapidly accelerating rate simply because they could; the Radio Act of 1912 declared the secretary of commerce to be the regulatory authority over radio, but the secretary was compelled by law to issue licenses to all who applied for one. In 1922 there were 5 radio stations on the air; in 1923 there were 556. To avoid interference with other stations, broadcasters changed frequencies, raised operating power, and/or moved their facilities. The result was an industry headed for mutually assured destruction. Attempts at self-regulation failed in a series of radio conferences convened at the behest of then–Secretary of Commerce Herbert Hoover.

The Radio Act of 1927 was enacted on February 23 to address the crisis. The legislation conceptualized radio broadcasting as an industry in its own right, not as a means of point-to-point communication or as a means of ensuring public safety (as did the Wireless Ship Act of 1910 and the Radio Act of 1912). The 1927 act created a five-member Federal Radio Commission (FRC) with the discretionary authority the secretary of commerce lacked under the 1912 act. Commissioners were nominated by the president of the United States and confirmed by Congress and served overlapping terms to maintain operational continuity. No more than three commissioners were permitted to represent any single political party. The FRC was to share regulatory authority with the secretary of commerce (although authority was never vested in the secretary of commerce) and after 1 year the FRC was to sunset, leaving the secretary of commerce as the sole regulatory authority. Sorting out the chaos was a daunting task, and Congress extended the sunset deadline twice. Congressional attempts to make the FRC a permanent body failed.

The legislation created the FRC's guiding regulatory criterion—the “public interest, convenience, and necessity” (PICN). The act did not define PICN, though, and the FRC gave much attention to clarifying PICN in the first 2 years of its existence. Congress did not define the PICN standard in specific terms, leaving [Page 121]it to be defined by case law. The legislation declared the airwaves were a utility owned by the public and charged the FRC to regulate broadcasters so as to guard the interests of the owners of the airwaves by issuing licenses to operators who wished to use that utility. The Commission was forbidden to censor radio broadcasters (in Section 29 of the 1927 act, in Section 326 of the 1934 act), but was given the discretion to create regulations and to punish broadcasters' subsequent offensive actions. Further authority was given to the Commission to renew the licenses of broadcasters who served the public interest: to revoke the licenses, fine, and/or imprison broadcasters who did not; to classify stations; to prescribe the nature of service to be provided; to assign frequencies; to determine transmitter power; to create regulations to prevent interference; and to set up zones of coverage areas. Upon enactment, the Radio Act of 1927 revoked all existing commercial radio licenses and required all operators to re-apply for new ones. All but a handful were granted, but the exceptions are notable; among them was Dr. John Brinkley, the infamous “goat gland” doctor who operated KFKB in Milford, Kansas. Brinkley invited ailing radio listeners to send letters describing their symptoms, and after reading them on the air Brinkley prescribed medical cures that required his own widely available patent medicines. The FRC found Brinkley's actions to fail the public interest standard and did not renew his radio license, the first to fail re-application. In 1933, the Supreme Court affirmed the PICN standard along with the FRC's authority to use PICN as an administrative yardstick (Federal Radio Commission v. Nelson Brothers, 1933).

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