From the Brookings Institution’s insightful 1948 report, Overseas Information Service of the United States Government, by Charles A. H. Thomson:

The Smith-Mundt Act needs amendment in certain particulars. Its statement of objectives should be modified to make it clear that the program is solely designed to further the foreign policy of the United States. … The authority to disseminate information abroad should be broadened to include the distribution of any information, whether about the United States or not, which furthers the purpose of the act. The policies governing release of material used in the information service should be broadened to authorize release to the general public at any time after use. What is safe to foreign audiences to get should be safe for our own people.

On privatization…

The main problems in the use of radio have been the distribution of function between public and private authority; the question of facilities; the questions of program structure; and certain questions of personnel. …

The insistence of the Senate in 1947 forced [the Office of International Information] to turn over a much larger portion than ever before (70 per cent) of total international radio broadcasting time, to the provide networks. … The Senate Appropriations Committee had presumed that private enterprise would obviously do a better job of program construction than would any government agency, held down by the dead hand of bureaucracy, or animated by left-wingers inherited from the war agencies. …

The interest of private firms in continued international broadcasting arises out of the hope of future profits in some areas, as well as a patriotic motive. One congressman at least has pointed out the interest of the networks, and particularly the World Wide Broadcasting Foundation, in getting government pay for current international activities.

From the standpoint of of the strategic interest of the country, the question of how to distribute emphasis between the private and public operation of international radio is chiefly one of the comparative effects on audiences of one or another solution. … This argument rests on the presumption that the impact of private and therefore “disinterested” radio is more powerful, or at least different from that of an official government service. … [T]he war experience does not show any superiority of NBC- or CBS-produced programs over those done by [the Office of War Information]; if anything, the contrary is true. From the strategic point of view, the element of control is one of the most important determinants.

Finally, there is a the basic issue of the assumption on which government or private programming is based. Government international radio, due to war experience, has been more and more clearly focused on combining service to foreign audiences with transmitting material which the United States government wants stressed. The private networks have made their success in the domestic field; there is no reason to suppose they have any technical advantage or inherent incentive in coping with the particular problems of foreign broadcasting, particularly from a strategic point of view.

And

Karl Stefan (R-NE) stated on March 11, 1948:

“I have been approached time and time again by representatives of both broadcasting companies, National Broadcasting Co. and Columbia, and by this man Lemmon of WRUL in Boston, and by the people who operate those stations on the west coast. They were lobbying. They are not turning down $2,000,000 a year – do not worry about that. They are here after the money, in plain ordinary language. They have been down here on the Hill after this money.”

Stefan continued: “The purpose of section 1005 of this act [the Smith-Mundt Act] is to put as much of this broadcasting in the hands of experienced private agencies as possible. That was the sentiment on Capitol Hill. That is why that section was put in there by Mr. Horan of our committee. Mr. Mundt in his report on the bill, indicated the same thing. in face, he went on the air with Mr. Lemmon of WRUL and indicated that he wanted more and more of it in the hands of private industry.

“Some of the Members of Congress have felt, I am sure, that experienced radio people could do a better job, under the guidance of the Department of State. The testimony in my committee was that perhaps they could not police this broadcasting if it were put in too many private hands, and therefore it was best to confine the number of private agencies to two; that they are getting along very well with them…

“I can see the side of the Department, but I can also see Mr. Horan’s point of view and that of others, such as Mr. Mundt, the author of the bill, that as long as we have private facilities, why not use them, if they have experienced staff. …

“Of course, I do not want the State Department to feel that the [Walter Lemmon of WRUL] ought to have control over a policy of that kind. That is our responsibility, and the responsibility of the State Department is to determine what kind of material is going out in the name of the United States of America.”

Thomson noted in his conclusions that “existing networks or new entrepreneurs (except Lemmon himself) show little disposition to expand operations in the international radio field.”