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M: Bessas. Yes, sir. M: IN:lmon, Now, in those instances you do pay royalties, do y ... ghted materials that you use! ¥• Lzenvas. Yes, and we agree with the principle of that. VDs. Now, do you negotiate with the copyright on ";! rofthose syndicators? ** P. We buy the program generally from a distribute

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V DM. Can you tell me if the word "distributor" as

Zar to "syndicator"? MLADAN, Yes V Devels. Thank you, that's all the questions I have. Yo :2784M2!FR. The gentleman from California, Mr. Wig H* Wala. If I understand you correctly, when you are s

- on a large market, you can extract from an advertiser a g ory of his access to that market. in va have any data showing that the copyright owner sha


Mr. Simon. Here is the dark line, the primary viewing line 263...
Mr. DANIELSON. And this is from San Francisco.
Mr. Simon. That's correct, San Francisco stations.

Mr. BRFSNAN. The white area goes all the way up to Origin, 17: east into Nevada.

Miss Da Costa advises me that, not only do the broadcaster fr : San Francisco claim this coverage--and therefore ultimately in filter back to the copyright area-but she says also, that the sta. cators will at the same time be selling programs in the Saura" is a Reno and Redding markets, also; they are selling them again to! markets. And what they are proposing to do now in the case of CATT, is to sell them a third time in many cases.

Mr. DANIELSON. Now la-tly, it's my understanding that the awapo of a copyrightable item, let's say the film of Bambi, may sell be right to use it to, say, a Boston TV station for their regular bra.

Suppose that the same film has been sold by the copyright oto leased, licensed, what have you, to a TV station in the city of New York for its use. And through cables they picked it up and do nated the program within the city of Boston, let's say, a nort: .: advance of the showing in the city of New York.

Does not this diminish the value of the Boston licensee in using the film?

Mr. BRESNAN. Sir, if the copyright owner--the owner of the por uct--didn't recognize when selling that product, in this comit": Bambi film to the New York station, didn't recognize that that would go up into the Boston area, he is a fool because the cove! area of these stations, as you will see when you examine the brotams that I am going to leave with you, is clearly depicted. This is no merrt. It's no shouldn't be a surprise because it's stated in the advertising literature how far out that station's signal goes les of CATV.

Mr. DANIELSON. OK. Are you, sir, or any of you in vour group at: to tell me, or do you have any expertise, how are the nepok:31.47% carried on between a copyright owner, the owner of Banib, to' example and the station?

I don't know anything about that. Do you advertising people do that kind of work?

Miss DA COSTA. Well, generally the syndicator is the one that." programming to individual stations within markets. T! Destiste and take that into account, the number of homes that are delivert to that particular station and that particular market.

Mr. DANIELSON, I think we have a word of art here. You wid": cators," are they the people who sell the tilms, and so forth

Miss Da Costa. Yes, sir.
Mr. DANIELSON [continuing). To broadcasting station!

Mine Da Costa. There is some company that does that all!cout there are some originating producers that do their own 11

Mr. DANIFION. But in that connection, the sale includes whatrier in the copyright rovalty. that is in the package

M: DA CONTA. That is a total package. Yes

Mr. DANIELMON. Now, some of the Teleprompter stations ortiste their own programs. I am sure I heard you say that.

M: Breases. The copyright owner negotiates with the broad

fer with he will receive for the carriage of his prograr · "scowgier has available to him the advertising brochu pog'it. Wowing the coverage area.

1 tsip 50 pawn to believe that the copyright owner we how wital.lage of suh material in his negotiations. I have

st. ttt ma negotiations, I'm not sure what goes on there, H. Winds Dres anybody at the table have personal exp

VDicuntaI don't think that anyone can really determir

is of the rate ther are charging, if it's just a copyright,
" the use of the program. I think the syndicator esta

n'at w trude some copyright fees. And also, in nego
try at al on but will hopefully get what he feels the pro

WW : But at least you are representing to us as a fact
of the island upon the the total market to be served.

Cinta. That is taken into consideration, yes, sir.
H W Now, you have experience. Miss Da Costa,
13.2 pwal acidunts I gather your agency does not

Cit. We have one that we call a local advert
Veritati Bank

\, it W-11. I was thinking more about Joe's Used

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HW:: It seems to me that local independents are a

13.30 deglers lling their cars--I don't understa

ar trof is really appealing to those large market 2.3" *t svärda a lowal car dealer would be unwilling ti 22:101pxpanded coverage because it's beyond his norm

****, isa't it likely that commercial operators na to, ali dve denied the market of their own, and

Mr. BREASAN. Yes, sir.

Mr. Desiroon. Sow, in those instances you do pay royalties, do you, for the copyrighted materials that you use!

Mr. BREMSAN. Von, and we agrie with the principle of that.

Mr. DANIEMI. Sow, do you negotiate with the copyright owner, or with one of thon indicators!

Mr. Barns ss. We buy the program generally from a distributor of the program.

Mr. DASIYLON. Can you tell me if the word “distributor" as you uw it ismlar to "wyndicator"!

Mr. BREVAN. Yes. Mr. Divx. Thank you, that's all the questions I have. Mr. Kink. The gentleman from California, Mr. Wiggins, Mr. WHAN. If I undertand you correctly, when you are selling nie to a large market, you can extract from an advertiser a greater fer la line of his area to that market.

Do you have any data showing that the copyright owner shares in that!

Mr. BRATIS, The copyright owner negotiates with the broadcaster for t! fees which he will receive for the carriage of his program. The Copright owner han avalable to him the advertising browhures of tu station, showing the coverage arra.

Ibup no reason to beliese that the copyright owner wouldn't Bakr avantage of milih material in has negotiations. I have never et in on thome negotiation, I'm not sure what goes on there,

Mr. W. Does anybonly at the table have personal experience

VACAI don't think that anyone on rally determine what {wortion of the rate this are changing if it's a copyright, or just 11. Pitne or the up of the program. I tiunk the indator establishes tiraletlent will belude some copyright free Andal), in negotiating with the nation he will hopefully that what he feels the program is worth

Mr W.611. But not least you are proprementing to is in a fait that the L. ;" * ord for in a contiene la tot el market to be prvei.

1 o Da Cuern. That is this into weder if?011, 1p, kir.

Mr 1114:11 low, you have partie, M.-Conti, with na 1.1021) Ariel ronal mount I puttes pour toy do not handle de sport ste

M.-- Cri bass coties that are ulla lexal avertiser, the 1. Vorbitan link

V: Inne Well, I wompiurk ng normalmut Jerald ('ar Laxt.

Mr. l. ll *** met' at low all trident autantis
barnallis 91,40 delen, tostirrin toont understand that a lot in tre'ls up for I'mort arrat Vly
fiilid plaanbalserie til! Hoyez let' !!!! to pay for
that of of rupee susretna d'inici lois fuorina niin
18!!! - plonge, 1-3 like! It

is inderator xmlarla ...nesl nolebede lue driviellement of ti..I on n. a. I would not be

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KR: EVYFIER. The chairman will interrupt to announce th
est for a vote on the House floor.
V Duis. Are we coming back?
MA HTEN MEER. So, we are not coming back.
Non. Mr. Chairman, may I suggest that the pampl
".4 to metu placed on the table—they don't belong in our reco
is, de melve them for our files, for the record ?
M: KNMEIER. Yes. Any materials that the witnesses have r

Tis pleman from New York, Mr. Pattison !
X: Patams. Well, I had some, but we are not going to have t
KMLER. On behalf of the committee, we thank

ma?.30. Mix Da Costa, and your associates, for appearing here to
I will announce that tomorrow at 9:30 the subcomm

first to hear briefly the news archives issue with two
mo, ai then, at 10 o'clock witnesses generally supporting se
... : part cularly from the broadcasting industry.
"at time, the subcommittee will stand adjourned.
Tward statement of William J. Bresnan follows:]



inclined to go to the owner of a copyrighted work and buy someth3 that is shown in one of these isolated areas?

What I am trying to project to you very inartfully is that it sors to me there is a difference betweeen local advertising and regionala national advertising, and that to the extent that national advert: blanket an area, they deny to a copyright owner the opportunity to e.' his work to a local advertiser. Have I made that point clear

Mr. RAILSBACK. Will the gentlemen yield?
Mr. WIGGINS. Y es.

Mr. RAILSBACK. Oak Park Savings and Loan carry ball games and they come into my arra, and they come in with local advertising, or Koons.

Miss Da Costa. I'm not familiar with those.

Mr. RAILSBACK. His point is if the gentleman will yield furtheryou may not always have a regional advertiser.

Miss Da Costa. Let me just explain to you how that works starting with the national advertiser. A national advertiser presumably har. tional distribution, and his product can be bought across the counter Therefore, any advertising that he buys in one market, or an aduna: lation of markets, his advertising is worth putting it on that , because his product is everywhere.

A regional advertiser has a similar situation within the mgion are that they have product distribution.

As far as the local, the truly local advertising that you are derby ing, sir, that advertiser feels, when he is investing money on a team vision station within his market that the medium is strong enough to get him customers, even though he pays a 10-percent premium for thore homes that are not potentials for him.

Mr. WIGGINs. Well, perhaps that's so. Your illustration mentzumend New York City and Oswego, I believe. I would think there 19 a ** sibility at least that a used car dealership in Oswego, which minit otherwise be in the market to buy a movie, is not going to do win that movie is being transmitted to New York City. And that to an FI tent it is true that a copyright owner is deprived of an oppwortiin ty to sell his prowluet in Oswego.

Mit Da Costa. But if we examine hard research data that is an.. able to us by county, where we can see the signals and «tations to s are being viewed bv the homes in the county, we see that !!) peripet of a county's homes views signals that are imported from as far aus as New York. And consequently the potential for that lewat card. tributor i 90 percent of the market.

Mr. WIGGINS. Well, I would like to be expos to this hand data in which you have your conclusion. I realize the conclusion is stated intia testimony, but supprime that you worked out the time in port of this and, if you have them, would make them available to the notion.tter Mr. Charman. I would appreciate it.

M:1). Comra. Sir, I did prepare a lectre list of counties in . I looked at the actual viewing as it is reported by the delen (a. which is a real search orguuzation. Thus is the kini of infos mation, if you will allow me to jut mention it.

For example, in Onena County, warhim in the State of Nem Yine, we found that 3.4 perrent of the households viewed the WNEW IN station in the cour of a whole week.

Prefert. I am William J. Bresnan, Senior Vice President of ****!! no aud Pruudent of our Cable Division. Teleprompter is the n

# mapans, having approximately twice as many

bef* as the second largest company,
srat Jay Rickx a partner in the firm of Hogan & Hartson.

swt. Or Da Cava, Director of Media Information and Analysis And 120:- ber left in Barry P. Simon, Teleprompter's Vice Presid Booga tips prisition on copyright is straightforward. We belier

s bould not be required to pay ANY copyright fee for * 12 skal

Serend obi* weition, it is necessary to understand a basic fact a' 104:10 - Part which makes that industry unique among a

perighted materials. The broadcaster, unlike the mo
to sus amber, does not sell a copyrighted product. What th

tbt attention of the viewers. The purchaser is the adverti
be borrade arter can deliver to the advertiser, the more th

be mise the advertiser pays, the more money is a
..1*** o pay the copyright owner.
ons this this relationship only by enlarging the audien

ster. It many cases this actually increases the ad
ariatu pas the copyright owner. In no case does it dej
og athing to which he is entitled.
4 m. strated by two examples.

in Wation located in a community, part of w possa reiption is poor. Imagine also that a cable i ** Typ fu the periple of this community. The people w

Bara Empresa) they can install a tall rooftop ai

a badeat by the television station, (2) they can is my S, HD ****»-tn and thereby get the benefit of the anter og Himin system or (3) they can do neither and TV ***** prime. As the Supreme Court has twice i 242 Lails identical Since no copyright liability

**** opgeslawn antenna, why should there be an by ****2!

**!! of the antenna tower erected by the en 'D' at set to say that the cable television system

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skipa stogt of providing its service for clear

hf the televisivit spt manufacturer and *** ita related businesses i also seeks


Mr. K A TEVYFIrr. The chairman will interrupt to announce this is trulig for a vote on the House floor.

Mr. LANDAON. Are we coming back!
Mr. K AKTUA MED. So, we are not coming back.

Mr. DaviLON. Mr. Chairman, may I suggest that the pamphlets t.p witnes plaerd on the table they don't bwlong in our recordbit that we nense them for our files, for the record!

Mr. Kim MEER. Yes. Any materials that the witnesses have made available

Tie gantleman from New York, Mr. Pattison?
Mr. P turn. Well, I had some, but we are not going to have time.

Mr. K** 12A MER. On behalf of the committee, we thank you, Mr. Bran, Mila (osta, and your inte, for apparing bere today.

'The Chair will announce that tomorrow at 9:30 the sulmommittee *:!l convene, first to hear brietly the news archives issue with two wit. lif; and then, at 10 o'clock witnesses generally supporting section 111, morr particularly from the broaderung industry.

Until that time, the submittee will stand adjourned.

(The prepared statement of William J. Brennan follows:) STAITMENT OF WILL LAM J Bassan, Srazom l'rx PeruIDENT AND PRESIDENT,

CARE Division, TLI .Mrnxs (our. fed after I an William J BrestanSendus l'he President of Tele pt 11.fort (oppard Prralle tot of sur l'atle Ina Nilepyrollpiter in the nation inre of puble erleV69,610 khay, hnvirk apprutiikately tidae as many cabie 12.tile mullerenelle ******* largest ***121*

In my right in Jay R a partier in the prin of Hon & Harth On ny lek in 11,40 la 11.extor of Merm 1. fronation and Arts at To Py's & Go Rutar ber left in Barry P Nsfhd, Telo priljne lue lrendel anad

1. : purustl.pears with an unsrivht in straigh'?rward We Beliese cable te'asje): t ***** plus loita'il le ryhted to pay right fre for the car. TOP Poradea ! .girl

1. 11.feraand his,'10-13 It in napears to understand a basde fact atmut ile hope to stratri afrit valih form !lat lid strå utf***an:"8111 Bier

**, Puit of sportabel balletisi Tl. btsud: aver, ulat. Ar the je por dnet op! be le poti indir dowla i pred priam What the be ad norr slls is the "F*!) of the lowers i tot par har lether advertiser The

tp I ****, poprt in the site to the airport aufr tlır adirt Pin 11 ay

Ariffle u prilir asl.? **** te Buste lustry is available Pritardor.711 ***!!, fra ilir sig.**.**** radiotelet, Prin!!... Por it.f) :. by Fridt, l'he Adlere avail

the way tle !11! Ip?", M: 1.1.4 to the plot 11 in aer des de peine der

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the far 1 t. !!! 11 rallir.elst tilata!

* 1 1 ** ale funkr a pop!

"mid go on and on. But rather than belabor the point, I'll si * ****pr! cores themselves to the Committee.

be lira riewers that cable adds to the audience of these sta Bat! . De triationship between station and advertiser? It means tha 7. It is flore valuable and so the advertiser pays more. Listen to Mitta, who is in charge of all media related research at Ted 1

go QR *!!! iar pat advertising agency, says: costurning on CATV systems has been included in surveys for

ise in the total audience reported for individual stations. The ind ****s ard the total audience figures to establish rates and corres

lies. This practice compensates stations for all viewing inc) spala place within CATV homes (both inside and outside the ***' fair reception)." !! i to our example, we see that the copyright owner whose cr ***732 by be New York City station and imported, by cable, to view **** **** been deprived of the chance to earn money by showii

: . (kargo For the advertising revenues to be derived from sb as the cable subscribers in Oswego have already been deriv "*1*1'ij station And, as a result, the New York City station w

Yemer more than if the station were unable to reach the (

in the marright holder to be compensated again-this time d **** i Brgli cable syutem--would be giving him the windfall of an unde

0:43. Tum is a windfall that neither the cable television indus "the American households which are cable television subscribe

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Timelin, at 2:53 p.m., the subcommittee adjourned, to :>>*7'2.m., Thursday, June 12, 1975.)

Before going on to the second example, let's pause for a moment in ever done alternative (3) --where the prospective viewer neither buys the tall anr.: 1; subscribes to the cable service but simply doesn't watch the programs by our hypothetical television station. If this happens, what is the pay!** 1) station has a smaller audience and therefore its advertising spots are *** 3' tractive to potential advertisers. So the station gets less money. And this 12 there is less money available to the station to pay the copyright owler he this we can see that cable television, far from stealing from the corpore owner, by increasing the size of the broadcaster's audience actually increase monies paid to the copyright owner.

Now consider a second situation. In this case imagine a television status ir \ York City whose programs are imported--via microwave hope by a cabot ****** and retransmitted over the cable to the cable television systemi's suburben Oswego, New York who otherwise would not be able to view the New York (9 station.

Is this situation really any different from our first example? Is the experience owner somehow damaged by the action of the cable station? Is he. Jurbaine de prived of the ability to exploit his creation in Oswego after it has bei tobom on the cable?

The answer to all these questions is, no. Because of the nature of broadrag fra nomics, the copyright owner cannot be injured by the cable mystem's imp the New York City station into Oswego. And this is true even without an tion of the complicated FCC exclusivity rules which wk to give added tion to the copyright owner and which may require the cable system to programming so as to allegedly protect the copyright owner's markets

As in the first example, by showing the imported programs in ()-wego tberg system increases the audience of the New York City station. And thi* 15:! just a theoretical increase. The rating services -- Nielsen and ARB - stund a moment sums of money to keep track of cable subscribers with the result propong single cable subscriber is accountel for in their surses and so find b**** into some television station's rate base. Thus, by simply checking in .. ** find for example, that

In San Luis Obispo County, California, 30% of the teleriai
view the Los Angeles independent and network stations on a remar'::!

In Grant County. New Mexico, 51% of the television homes for
El Paso network stations on a regular basis,

In Chemung (ounty, New York, 19.5% of the television bones rew
New York City independent stations on a regular basis,

In Lane County, Oregon, 20% of the television bomes view the Poriad independent and network stations on a rgular basis, and

In Sweetwater County. Wyoming. 61 of the telerinden hoflea * Salt Lake City network stations on a regular basis. In these cases, and in countless others, such corerage would be !**** without cable television.

This fact has not been lost on the broadcasters. For example, the lifera' re put out by the Association of Independent Television Stations, in iri: quansing the up illustra:ions in which the white arvas show the real op i som pendent stations as enhanced by cable televi«!0, ntales

The arrompanying illustrations show how indie felerisirin can increase the physical coverage area of independent sintien... expand. :* 11.fluence far beyond the perimeters of the lowal telerinin market

"Advertisers on calledonnected independent statlon. in . Fra led TV Terak,.. reaching a bonts audience of the 1111.** as rain!'r.*** natjeral regional advertiser as those situated within the defited jeal La

As a further illu-tration of this point, I have here a spark? porta', :a browlir put out by televien ta'l Fith one taky fa.las **,!.* AM1:41:17 includes alle striber in diman! marhetne mend', a:

KTLA, an independent station in lan aples claims amater p**** 1 a'u.tne iban any other ! 11* Ange* ?2001, tietoturk lif itales entre sta't audits !!* *****,10 ant fi*istration by way of ('ll' a'. *

WG;V. at 11:0****t.detit mation in chiaro, claims substantiai va*ing ?ar

pat.d the reach of is smalby vrahem*p*}},* Talent of her a network map in Mali Lake Cyr, shortage his ASI. of "\[}m'nin Amerha" es et extending thanks to enable triev.s. l ** far as northerta Wyetirilen

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