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Mr. K ANTENVEIER. The chairman will interrupt to announce this is t!. war old ring for a jote on the House floor.

Jr. DANHAON. Are we coming back!
Mr. K . AMEER. .So, we are not coming back.

Mr. DANIELNI. Mr. (hairman, may I sugirst that the pamphlets tlar uit te vers placed on the table- they don't belong in our record bit mat we nenethem for our files, for the record!

Mr. Kist. IR. Yes. Any materials that the witness's have made available.

Tirpintleman from New York, Mr. Pattison?
Mr. L'arus. Well, I had some, but we are not going to have time.

Mr. K1-17. VIR. On behalf of the committee, we thank you, Mr. Bryanan, Mila Costa, and your awinter, for appearing here today,

le (hair will announce that tomorrow at 9.30 tie subwommittee will contenie, first to hear briets the news arhites is de with two wit. fums; and then, at 10 o'clock witnes generally supporting wction 111, morn particularly from the broadca-111g industri

I'mol that time, the subwommittee will stand adjourned. [The prepared statement of William J. Brenan follow:



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Before going on to the second example, let's pause for a moment in alternative (3)-where the prospective viewer neither buys the tall ante : subscribes to the cable service but simply doesn't watch the programs bag 26 by our hypothetical television station. If this happens what is the fouille The station has a smaller audience and therefore its advertising spots are los tractive to potential advertisers. So the station gets less money. And this time there is less money available to the station to pay the copyright uxler y this we can see that cable television, far from stealing from the rear owner, by increasing the size of the broadcaster's audience actually iberri 'Y monies paid to the copyright owner.

Now consider a second situation. In this case imagine a telerision station in Ve York City whose programs are imported-ria microwave hope by a cab 18*** and retransmitted over the cable to the cable teleri On statens k l . Oswego, New York who otherwise would not be able to view the New Work station.

Is this situation really any different from our first example? Is the capire owner somehow damaged by the action of the cable station? Is he phone prired of the ability to exploit his creation in Oswego after it has bert L'S on the cable?

The answer to all these questions is, no. Because of the nature of braduc nomics, the coprright owner cannot be injured by the cable sistem iLD*** the New York City station into Oswego. And this is true even without fix 1. tion of the complicated FCC exclusivity rules which mek to gire added. * tion to the copyright owner and which may require the cable system to deve programming so as to allegedly protect the copyright on her's markets

As in the first example, hy showing the imported programs in (**) Le system increases the audience of the New York City station. And ... ! just a theoretical increase. The rating services-Nielsen and ARB vnd sums of moner to keep track of cable subscribers with the real that mir single cable subscriber is accounted for in their sureys and s u.. . WAT into some television station's rate base. Thus, by simply checking in Sie find for example, that

In San Luis Ohispo County, California, 30164 of the teleria en view the Los Angeles independent and network stations on a reguar':*

In Grant (ounty, New Jexico, 51 of the television botes tiram El Paso network stations on a regular basis,

In Chemung County, New York, 19.5 of the telesi on boa ripsi New York City indepændent stations on a regular basis

In Lane County, Oregon, 20% of the television homes view the Pr.194. independent and network stations on a rugular basis, and

In Swerwater County, Wyoming of the television bote t he Salt Lake City network stations on a regular basis. In these cases, and in countless others, such coverage would be liliwan: .0 without able teleri ion.

This fact has not been lost on the broadcasters. For example, the tr?s my put out by the Association of Independent Trevison Sati49. in 1! unting the illustrations in which the white and how the rea" Twendent stations A nhanced brable telerision, *****

**The atompanring illustrations show how e teleria:n aan dn ** inonase the physical average area of independent **at1... Plat. . inten far beyond the perimeters of the local teieren arr!

"Advertisin on cuboiyond annen Indfuldent **a"!! !.. .n .** TV IPTAR , Trich, in a bon's audition of (*1'111. 11... Porn , national regional advertiser as these situated wllin the define u na ?

om mild go on and on. But rather than belabor the point, I'll sin ** lurn themselves to the Committee. ng iba patra viewers that cable adds to the audience of these stat

the opposilonship between station and advertiser? It means that ' n s boppe valuable and so the advertiser pays more. Listen to Wind wo is in charge of all media related research at Ted E

G hargent adsertising agency, says: ""* turting on CATV systems has been included in surveys for were in the total audience reported for individual stations. The ind 24 Brom iriurd theme total audience figures to establish rates and corres La Patie This practice compensates stations for all viewing incl

...ane place within CATV homes (both inside and outside the port, s-air reception)." PCA to ir esample, we see that the copyright owner whose cr

0.7 mg tbe New York City station and imported, by cable. to view "Ning se ben deprived of the chance to earn money by showi

* *x! Nothpgo. For the advertising revenues to be derived from sł E ns to the cable subscribers in Oswego have already been deri slayt1's station And, as a result, the New York City station w

ye wner more than if the station were unable to reach the ( ir be copsright holder to be compensated again--this time boom nego na tle is ten-would be giving him the windfall of an und *! This is a windfall that neither the cable television indus

the Ancierican bouseholds which are cable television subscrib Pake.

T o n, at 2:55 p.m., the subcommittee adjourned, to **** ut? .m., Thursday, June 12, 1975.)

As a further illustration of this point, I hair bere as

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The 11*t could go on and on. But rather than belabor the point, I'll simply these bromhare themselves to the ('ommittee.

Want de the prin viewers that cable adds to the audience of these stations man to the relationship between station and advertiser? It means that the

ut time is more aluable and the advertiser pay more. Listen to what 11.** Ina (on, who is in charge of all media related arch at Te Bates, the lidt 's Alih larges! adier'inink a kenoy, NR

lewing (xYurring On (ATV tells has been include in surveys for quite savor tine in the total audiene tri orted for individual stations. The industry ham gitser.!!114 the total audience figures to putablish rutes and correspond11.8 aut etherne!" This practice complimelestations for all viewing including Put which inkes place within CATT home (both inside and outside the range of lor ta' lot of air rition)."

To pulak to our piata ile, kes that the pyright owner whose creation is broadene by the Sework city station and imirteed, by cable to viewers in O rgy has not been derispel of the chance to earn money by showing his

for retiut al P For the advertisin1% Petits to be derived from showing the p ain to the cable suburn in O eko have already been derived by the Ve Sosk (ity inton And, a* a *ult, the w ork (ity station will pay the copyright in tertiore that if the station were unable to reach the (wego

To allow the right holder to be compensated again this time directly nog tlor ( px) (alle sjarm would I KISIR hit the windfall of an undeserved

YUN J ment This is a wid! all that he'ler the table feleision industry nor the 13% of the American hurehods which are able television subcribers can af.

Thank you.

(Whereum, at 9:33 p.m., the subcommitter adjourned, to meronvene at 9 36 a.m., Thursday, June 12, 1975.)

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