I would like to send you, under separate cover, a copy of the Report (in Japanese) of the Subcommittee on home taping.

The Report was submitted to the Commissioner of the Agency for Cultural Affairs on June 26, 1981. It concludes roughly as follows:

"The Subcommittee has reached a conclusion that at present it is difficult to adopt particular measures to solve the problem of home taping from the following reasons: no agreement has yet been reached between the owners of rights concerned and the makers of recording equipment and materials on how to solve the problem; a full understanding of the problem has not yet been diffused among the general public; and it is still necessary to gauge the general trend of world opinion on how to solve the problem.

However, on the understanding that, because of a remarkable spread of recording equipment suitable for home taping, it is not adequate to overlook the effect of hometaping practices upon the owners of copyright and neighbouring rights, the parties concerned and the Agency for Cultural Affairs should endeavour to take proper measures to diffuse a full understanding of the problem among the general public."

There is a general agreement that the owners of rights concerned, the makers of recording equipment and materials and the Agency for Cultural Affairs should collaborate in an effort to diffuse the knowledge of copyright among the general public, aiming at the solution of the problem in the future. The makers agree to give economic cooperation (contribution of some ten million yen) to this project of diffusing the knowledge of copyright.

Cable Address MONBUNKA TOKYO

AGENCY FOR CULTURAL AFFAIRS (BUNKA-CHO)

3-2-2, Kasumigaseki, Chiyoda-ku, Tokyo 100, Japan

The Report also stresses the importance for the parties concerned of making efforts to reach an agreement among them on the problem of home taping. In this connection, there is a general agreement that the owners of rights concerned and the makers should continue negotiations, sitting around a "round table" on a non-governmental basis.

Hoping that this information would be of some use for you, and asking you, in my turn, to give us information on the progress in studies of the problem of home taping in your country,

Sincerely yours,

Y. Kimura

Yutaka KIMURA

Deputy Director

Copyright Division

Cultural Affairs Department

Senator MATHIAS. Ms. Sills.

STATEMENT OF BEVERLY SILLS, CHAIRPERSON, COALITION TO SAVE AMERICA'S MUSIC, AND GENERAL DIRECTOR, NEW YORK CITY OPERA

MS. SILLS. Thank you very much for allowing me to come.

I am the general director of the New York City Opera-I used to be Beverly Sills. I am here today as the chairperson

Senator MATHIAS. I think there are a good many million Americans who are still sure that you are Beverly Sills, and very glad of it.

MS. SILLS. Thank you.

I am here today as chairperson, or even chairman, of the Coalition to Save America's Music. It is a group that broadly represents the American music community, which includes artists, musicians, songwriters, publishers, unions, performing rights societies, record producers, and retail outlets. The membership which is set forth in my written statement as an attachment to it is made up of 21 organizations with over 2 million members. I stress that because they include great groups of people that normally do not lie down with one another harmoniously. But they have joined here today all in agreement, which I must say is quite unprecedented, because we agree on this one basic thing that there does indeed exist a grave threat in uncontrolled home taping. "Piracy" is a much more simple name for it.

I am sure we have all rejoiced in listening to recordings by Mr. Caruso, Rosa Ponselle, and Ezio Pinza. Imagine if those recordings had never been made. Well, I sit at the head of the New York City Opera, which is an almost totally American opera company, with a whole group of extraordinarily gifted young American artists. I made my career in that company. Therefore, I can safely predict that there might be a few other superstars coming out of my company. But if less and less recordings are made and more and more home taping is permitted in an uncontrolled fashion, then these young singers are not only deprived of the choice of what they would like to be recorded in, but they are deprived of a very muchneeded income.

I was lucky enough to document most of my roles, but what about these young singers coming along? Will their careers never be recorded or left to posterity because of this out-of-control problem? This may well be so because of the current economics of the recording industry. Release of recordings, particularly classical ones, is a very high-risk affair. Very few turn out commercially successful, and industry studies show that less than 10 percent of classical recordings break even. So that if record companies cannot earn profits even on the smaller percentage of records or tapes that do sell due to the pirating, then this entire segment of recording can whither away and die. I know this is so, because when I was recording, I was frequently told by EMI that my recordings were being paid for by the Beatles. Incredible as it seems, taping actually represents over 75 percent of all legitimate purchases. That is a very high percentage. And the reason people tape, according even

to the tapers themselves, is to avoid having to purchase a record or a prerecorded tape.

I would like to tell you a little story that happened to me not more than 2 weeks ago. I was approached by a gentleman who said that he had the most complete collection of everything I had ever done on television, including talk shows where I then sang an aria or two, including my complete operas, including everything I had done in the last 12 years-and he offered to sell me my collection. Can you imagine the outcry if we suddenly found that somebody had taken a whole bunch of new books and printed them cheaply and published them? Supposing we found that the number of new books had declined by one-third because of unauthorized copying, or that opera and concert performances had declined by one-third because of unauthorized admissions.

Now, I am not proposing that the freedom of consumers to tape music be denied. All I am proposing is fair compensation to the creators of that music. That is why we believe that amendment 1333 to S. 1758 is a reasonable solution to this problem, allowing some giving away and some taking back.

Some of my friends up here will examine in depth the severe economic impact record duplicating and taping have. But what really worries me is the corrosive effect on the very creative process itself. Record companies simply will be unwilling and unable to take risks on new artists, no matter how brilliantly these beckoning stars shine. A big thumb will be thrust down on creativity. I can see it already. The end result, of course, is detrimental to public interest. It is a denial of free choice and the beginning of cultural impoverishment.

The goal of our first amendment and copyright law is to encourage a maximum of diverse ideas and intellectual expression. Pirating has exactly the opposite effect.

Thank you.

Senator MATHIAS. Thank you very much, Miss Sills. I agree with you that is an astounding figure that 75 percent of all taping is off the market, privately done. So that would mean, I suppose, that 75 percent of all the tape libraries or home recording libraries are not coming through commercial sources, and this must have an enormous impact on the entire creative industry, the whole community of artists.

Ms. SILLS. I think it does.

Senator MATHIAS. Let me defer to the Senator from Kansas for a question.

Senator DOLE. The Senator from Kansas has no questions. I am trying to cover two meetings this morning, so I will listen awhile before I ask questions.

Senator MATHIAS. The Senator from Vermont.

Senator LEAHY. Thank you, Mr. Chairman.

I just read through Ms. Sills' testimony, and I was struck by the same points you made, and I find that I do not have questions. I am delighted you are here, Ms. Sills. Like so many of us, I have listened to you on many occasions, both here and in New York and am enthralled to hear you sing. This is the first time in person I have heard you speak, and I enjoyed that, too.

Thank you very much for being here.