The fortunes of the National Broadcasting Company (NBC) have always been closely tied to those of its parent company, Radio Corporation of America (RCA).
Unlike CBS, which was formed as an independent programming enterprise, NBC came into existence as the subsidiary of an electronics manufacturer which saw programming as a form of marketing, an enticement to purchase radio & television receivers for the home.
The power & influence of a national network aided RCA as it lobbied to see its technology adopted as the industry standard, particularly during the early years of television & in the battle over color television.
RCA was formed after World War I when General Electric signed an extensive patents cross-licensing agreement with Westinghouse, AT and T, and United Fruit. The product of this alliance, RCA was owned jointly by the 4 companies &was created for the purpose of marketing radio receivers produced by G. E. and Westinghouse.
As the alliance unraveled during the late 1920s & early 1930s, due to internal competition and government antitrust efforts, RCA emerged as an independent company.
In November 1926, RCA formed NBC as a wholly-owned subsidiary. Shortly thereafter, RCA added a second network, and the two networks were designated NBC-Red and NBC-Blue.
RCA, which had been merely a sales agent for the other companies emerged in the 1930s as a radio manufacturer with two networks, a powerful lineup of clear channel stations, and a roster of stars who were unequaled in the radio industry.
From this position of power RCA research labs under the direction of Vladimir Zworykin set the standard for research into the nascent technology of television.
NBC began experimental broadcasts from New York's Empire State building as early as 1932.
By 1935 the company was spending millions of dollars annually to fund television research.
Profits from the lucrative NBC radio networks were routinely channeled into television research.
In 1939 NBC became the first network to introduce regular television broadcasts with its inaugural telecast of the opening day ceremonies at the New York World's Fair of 1939.RCA's goal was to produce and market receivers and programs, to become the driving force in the emerging industry.RCA's dominance of the broadcast industry led to government scrutiny in the late 1930s when the FCC began to investigate the legitimacy of networks, or "chain broadcasting" as it was then called.The result was the 1941 publication of the FCC's Report on Chain Broadcasting which criticized the network's control of a majority of high-powered stations and called for the divorcement of NBC's two networks. RCA took the decision to court, but failed to overturn the FCC's findings. In 1943 RCA sold its Blue network to Edward J. Noble, and this network eventually became ABC.
After World War II, RCA moved quickly to consolidate its influence over the television industry. While CBS tried to stall efforts to establish technological standards in order to promote its own color-TV technology, RCA pushed hard for the development of television according to the existing NTSC technical standards established in 1941.