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cast the event. Apparently it is felt that even with the payment of the statutory royalty for the compulsory license which the Revision Bill would provide, it is unfair-to the sports promoter, to the league, to the broadcaster, or to all threefor a cable television system by its unilateral action to frustrate the consensual agreement of the marketplace. Yet the Revision Bill shows no similar concern in the identical situation for the copyright owner of any other kind of copyrighted work, no matter what its importance, even though he had deliberately chosen to license the work to no local station. It seems to us that logic would require that the copyright proprietors of news and entertainment programs be treated no less favorably than the promoters of professional sporting events. Respectfully,

ROBERT V. EVANS.

STATEMENT OF THE COMMUNITY ANTENNA TV ASSOCIATION (CATA)

AUGUST 10, 1973

CATA is a national association of small CATV systems whose problems and interests materially differ at times from those confronting large scale cable television operations and established cable systems in major television markets. CATA was formed in late July 1973 at Dallas, Texas to serve as spokesman for small CATV operators. Although CATA is still in its formative stages as an organization, its membership already includes more than 100 CATV systemsmost of which are family owned and operated-serving in excess of 90,000 subscribers throughout the United States.

CATA was not in a position to present its views concerning Section 111 of S. 1361 to the Subcommittee at its August 1, 1973 hearings. CATA representatives did, however, attend the hearings and are familiar with positions taken by interested parties who testified. CATA welcomes this opportunity to present its views on a single critical issue: whether small CATV systems should be subject to copyright liability.

Small CATV systems perform valuable services to the public by assuring adequate, dependable, television reception in communities and areas beyond major television markets. Costs of system operation, particularly expenses of upgrading plant necessitated by FCC enactment in March 1972 of technical standards, and other construction expenses, have been increasing at a very rapid rate. As the Subcommittee knows, the ability of small system operators to raise capital has been quite limited. Also, their ability to increase subscriber rates is often restricted, if not by the terms of their franchises, certainly by economic realities in the markets served. Moreover, most cannot and do not desire to initiate ancillary broadband services in order to gain additional revenues. Clearly, these small systems merit the kind of "breathing space" assured by a copyright exemption based upon size.

CATA recognizes that jurisdiction over copyright matters resides exclusively in the legislative branch. CATA cannot, however, ignore the fact that the Federal Communications Commission and the President's Office of Telecommunications Policy called various interested parties together in 1971 to hammer out a compromise among the several industry groups regarding the emergence of the cable television industry. Despite the fact that these FCC-OTP sanctioned negotiations had no legislative power and no jurisdictional control over the copyright question, compromises were reached on a wide range of issues affecting the cable industry, including certain agreements dealing with copyright. The entire package of agreements has become known as the "Whitehead Consensus Agreement". The Whitehead agreement, while not binding upon Congress, did contain a provision calling for the exemption from copyright liability of certain CATV systems-those with fewer than 3,500 subscribers. We raise this point not to say that the Whitehead agreement in any way controls the Subcommittee's thinking regarding the copyright issue, but rather so that the Subcommittee will understand that numerous small CATV operators acquiesced in the many unfavorable aspects of the Whitehead agreement because they believed that the broadcasters and copyright owners would offer their support for copyright legislation containing an exemption for small CATV systems. Hence, if denied the copyright exemption, the small cable systems will lose the single most important reason for accepting the various provisions of the Whitehead agreement, many of which have been carried over to the present Copyright Bill, as well as the FCC's CATV regulations enacted in March 1972.

Thus it was unexpected that Section 111 of the legislation approved by the Subcommittee lacked a small system exemption: CATA respectfully urges that

S. 1361 include an exemption from copyright liability for CATV systems having fewer than 3,500 subscribers. We understand there is no significant objection to the inclusion of such an exemption and will discuss why we believe it would serve the public interest.

As noted earlier, CATV systems in the below 3,500 subscriber category for the most part provide their subscribers with a basic service for improving television reception. Most of these systems operate solely as a means of delivering television signals to communities where normal television reception is poor or nonexistent : communities beyond the primary service areas of television broadcast stations; communities in which other secondary transmission facilities such as translators are either lacking or inadequate; communities near large cities but situated in pockets of poor reception produced by terrain barriers.

Some small systems also engage in limited local originations, generally of an automated nature (time and weather scan). Few if any such systems carry advertising, engage in pay television operations or operate their own microwave relay systems. They are, in short, the traditional community antenna television systems-locally owned and operated-which had their genesis in the mountainous regions of Pennsylvania and Oregon in the late 1940s, and which continue to depend upon subscriber revenues for economic support.

Although overlooked by the Federal Communications Commission when it revised its program exclusivity rules in 1972, small systems were taken into account when the agency enacted its mandatory origination requirement (47 C.F.R. § 76.201(a)) in 1969. 20 FCC2d 201. Section 76.201 (a) exempts systems with fewer than 3,500 subscribers from origination cablecasting, principally for economic reasons.

In its regulation of the broadcasting and common carrier industries, the Commission has evidenced a similar concern for the development of small communications companies. Exemptions from and exceptions to generally applicable, but often burdensome regulatory requirements, are not uncommon and have been construed to serve the larger public interest.

In the common carrier field, for example, small communications carriers were recently exempted from having to submit comprehensive economic data and information to support tariff revisions. See 47 C.F.R. § 61.38 (f). The FCC noted that carriers with "small revenues", limited service areas and "few customers" should not have to undertake the costly and elaborate reporting procedures required of larger carriers. Final Report and Order (Docket No. 18703, 25 FCC 2d 957, 965-66 (1970).

With reference to broadcasting, the FCC recently embarked upon a comprehensive program of "re-regulation." Many of its rule revisions grant relief to small market broadcasters from certain burdensome regulatory requirements. Similiarly, in rule making proceedings involving the renewal of broadcast licenses and the ascertainment of community problems by broadcasters, the FCC has recognized that factors such as market and station size may well warrant the application of different and less stringent standards to certain classes of licensees. Indeed, in an Interim Report and Order relating to broadcast license renewals, the FCC has exempted radio stations from newly-enacted annual reporting requirements applicable to television licensees and has promised to re-evaluate in a year whether it is desirable to require radio broadcasters to continue to adhere to additional local public file requirements imposed upon all broadcasters.

Finally, in the television broadcasting field, numerous rules and policies have been designed to favor UHF development and in some cases to exempt UHF licensees, which often are small businesses when compared to their VHF counterparts, from requirements applicable to VHF licensees. For example, 47 C.F.R. § 73.636, NOTE 8, provides for possible ad hoc exemptions to UHFS from duopoly restrictions consistently applied to VHF licensees. In addition, the FCC has a long-standing policy of fostering UHF development. This policy has been reflected in rules governing the agency's regulation of CATV systems. See e.g., 47 C.F.R. § 76.61 (b) (2).

The United States Congress has also gone on record many times in support of efforts to assist in the development of UHF television stations. One can also look to various statements by members of the Senate and House expressing concern for similar legislation to assist in the growth of FM radio stations. See e.g., S. 585. The list goes on when one looks to the Congressional hearings regarding the need for more frequency space to be allocated to the land-mobile spectrum. Even in this 93rd Congress concern for small businesses is evidenced by hearings held by Senator Thomas McIntyre regarding how broadcasters and

CATV systems are burdened by the thousands of pages of government forms which must be filled out each year. The United States Congress has always been the single body which the small businessman could look to for protection from the burdens of over-regulation.

Thus, there is ample support at the FCC for exempting small (below 3,500) CATV systems from certian economically burdensome operating requirements; more generally, there is support in that agency and in the Congress for assisting-whether by exemptions, exceptions to rules or special affirmative laws, rules and policies-other small communication entities in providing efficient and economical service to the public. The relatively limited exemption which CATA advocates, will do just that for small CATV operators, benefitting them and their subscribers consistent with the objectives of the Communications Act of 1934, as amended (47 U.S.C. §§ 151 et seq.) and is in no way contrary to or inconsistent with basic copyright principles and Section 111.

CATA respectfully urges that such an exemption for small systems-those with fewer than 3,500 subscribers-be included in Section 111 of S. 1361.

COPYRIGHT OFFICE,

THE LIBRARY OF CONGRESS, Washington, D.C., August 22, 1973.

Hon. JOHN L. MCCLELLAN, Chairman, Subcommittee on Patents, Trademarks, and Copyrights, Senate Committee on the Judiciary, New Senate Office Building, Washington, D.C. DEAR SENATOR MCCLELLAN : This is in response to your letter of August 6, 1973, requesting the views of the Copyright Office on several points in reference to the pending bill for general revision of the copyright law, S. 1361: (1) our specific comments on the language of S. 1359, including our recommendation of appropriate amendments; (2) whether the public display of original works of art would constitute publication and would therefore require a copyright notice on the work displayed, a proposal to establish a special form of notice for works of art, and a proposal regarding placement of the notice on works of art; (3) technical objections raised by the Counsel for SESAC to the language of section 112 (c) of S. 1361.

S. 1359

This bill was prompted by the fear that the Soviet Union, which became an adherent to the Universal Copyright Convention effective May 27, 1973, may attempt to control the copyright that Soviet authors will have in the United States and other member countries of that Convention, in order to suppress publication abroad of the works of some of those authors. The general views of the Copyright Office on this bill are incorporated in the report by the Librarian of Congress to the Committee on the Judiciary dated April 23, 1973, to which your letter refers. Among other comments, the Librarian's report expressed the reservations we have about the specific provisions of S. 1359, particularly the limitation of transfers of ownership to the foreign author's "voluntary assigns."

Our reservations are two-fold. First, the limitation to "voluntary assigns" does not take into account those situations in which the laws of foreign countries may provide appropriately for transfers of copyright by operation of law. Examples would be transfers effected by law in bankruptcy proceedings and mortgage foreclosures. Second, it is doubtful that the phrase "voluntary assigns" would be effective to preclude the acquisition by agencies of the Soviet Government of an author's right of foreign publication. The agency may be able to obtain from the author, through various forms of coercion upon him, a document that purports to effect a voluntary assignment.

As we see it, a foreign country's internal methods of coercion are a political problem beyond the reach of our copyright statute. What might be achieved by the copyright statute is to deny any assertion by an agency of a foreign government of its ownership of rights in the United States by virtue of its seizure under its own law of an author's copyright. It would not be necesary to proscribe transfers by operations of law to persons other than government agencies. We therefore suggest that, instead of the language in S. 1359, consideration be given to a provision such as the following:

"The expropriation, by a governmental organization of a foreign country, of a copyright or any right comprised in a copyright, or of any right in a work for which copyright may be secured, or the transfer of a copyright or of any such right from the author or proprietor to a governmental organiza

tion of a foreign country pursuant to any law, decree, regulation, order, or other action of the foreign government requiring such transfer, shall not be given effect for the purposes of this title."

As proposed in S. 1359, this provision could be inserted as a new subsection (d) to section 9 of the present statute. It could also be added to section 104 of S. 1361 as a new subsection (c).

PUBLIC DISPLAY OF WORKS OF ART; NOTICE REQUIREMENT

Your letter refers to an article in the Summer 1973 issue of Art News which suggests that the notice requirement in section 401 of S. 1361, coupled with the definition of “publication" in section 101, would place artists in a less favorable position than they have under the existing statute, particularly when original works of art are displayed publicly.

We consider it unnecessary to amend the definition of "publication" in S. 1361 in order to exclude the public display of an original work of art, as suggested in the article in Art News. In our view, the public display of an original work of art would not constitute publication of that work under the bill. "Publication" is defined in section 101 in terms that exclude public display of the single original "copy" of a work. Distribution of copies or the offering to distribute copies are the operative acts. The "offering to distribute copies . . . to a group of persons for purposes of further distribution, public performance, or public display" would constitute publication; this would cover, for example, the offering to supply copies of a motion picture to a number of theaters or broadcasters for public "performance" or "display." Public performance or public display itself would not constitute publication.

The concern on this point expressed in the artice in Art News appears to be founded on the supposition that the notice requirement in section 401(a) of S. 1361 might be held to apply to an original work of art when it is publicly displayed. To put to rest any such supposition, we suggest that the Committee report include a statement similar to the following one that appeared in House Report No. 83, 90th Congress, at pages 110-111:

"Sections 401 and 402 set out the basic notice requirements of the bill, the former dealing with "copies from which the work can be visually perceived," and the latter covering "phonorecords" of a "sound recording." The notice requirements established by these parallel provisions apply only when copies or phonorecords of the work are "publicly distributed." No copyright notice would be required in connection with the public display of a copy by any means, including projectors, television, or cathode ray tubes connected with information storage and retrieval systems, or in connection with the public performance of a work by means of copies or phonorecords, whether in the presence of an audience or through television, radio, computer transmission, or any other process."

For further assurance, we suggest that the Committee report add, after the statement quoted above:

It should be noted that, under the definition of "publication" in section 101, there would no longer be any basis for holding, as a few court decisions have done in the past, that the public display of a work of art under some conditions (e.g., without restriction against its reproduction) would constitute publication of the work. And, as indicated above, the public display of a work of art would not require that a copyright notice be placed on the copy displayed.

The article in Art News also proposes that the notice for works of art should consist only of the signature of the artist and the date of execution, and that the notice may appear on the front, back, base, frame or on any other readable part of the work.

The Copyright Office is aware that many artists fail to take advantage of the opportunity to secure copyright for their works, and do not comply with the notice requirements of the present copyright statute. The general revision bill incorporates liberalizing provisions that should enhance the opportunity of artists to claim copyright protection. For example, as already indicated, copyright would not be lost (as it may be in some cases under the present law) when an original work of art is placed on public display in galleries, museums, etc.. without a conyright notice. Where the work is reproduced in copies that are publicly distributed, a copyright notice on those copies would still be required: but the provisions in sections 401-406 of the bill as to the notice requirement are much less stringent than in the present statute, with respect to both the position of the notice and

the consequences of errors and omissions. The Register of Copyrights would be authorized to prescribe by regulation, as examples, specific positions of the notice on various types of works that would be adequate, and we have no doubt that the front, back, base, or frame of a work of art or other readable position would be acceptable.

We would not favor a notice consisting only of the signature of the artist and the date of execution. The symbol "," the word "Copyright," or the abbreviation "Copr." constitutes an essential element in giving notice that copyright is claimed. In effect, to eliminate this element would be tantamount to eliminating the notice requirement. We see no valid reason for excluding published copies of works of art from the general notice requirement.

SECTION 112 (C)

The Copyright Office agrees that the phrase "or of a sound recording" in section 112(c) of S. 1361 is unclear in scope and could be construed, as it stands, as including all sound recordings of any nature. We assume that the exemption in section 112 (c) for the inclusion in certain transmission programs, under stated conditions of a performance of a nondramatic musical work of a religious nature, was intended to allow also the inclusion in those programs of a performance of a copyrighted sound recording of such a musical work. If this was the intention, we suggest the insertion, after the phrase "or of a sound recording," of the words "of such a musical work."

We see no need for an explicit definition in the bill of the term "transmitting organization" which appears in section 112 (a) as well as in section 112(c). The term "transmit" with respect to a performance or display is defined in section 101; thus, paraphrasing that definition, a "transmitting organization" under section 112 (a) and (c) would be an organization that communicates a performance or display of a work by sending images or sounds from one place to another. It is important to note that section 112 (a) and (c) both relate only to "a transmitting organization entitled to transmit to the public a performance or display of a work, under a license or transfer of the copyright." This limitation serves to define further the "transmitting organizaions" to which those sections refer. We shall be glad to assist you further in any way you may wish. Sincerely yours,

ABE A. GOLDMAN, Acting Register of Copyrights.

U.S. SENATE,

Washington, D.C., August 1, 1973.

Hon. JOHN L. MCCLELLAN

Chairman, Subcomittee on Patents, Trademarks and Copyrights,

Committee on Judiciary,

U.S. Senate,

Washington, D.C.

DEAR JOHN: I would appreciate it if you would make the enclosed statement part of the hearing record on S. 1361 which is currently under consideration by your subcommittee.

With best wishes.

Sincerely,

Enclosure.

ALAN CRANSTON.

STATEMENT BY SENATOR ALAN CRANSTON ON S. 1361

I would like to commend the members of this committee for their hard work and persistence in undertaking a revision of the Copyright Law.

I am particularly interested in Section 111 of the bill, S. 1361, which concerns copyright fees connected with the carriage of television signals. There has been considerable debate and disagreement over the setting of fees paid by cable TV operators for material taken from distant commercial television signals and rebroadcast to cable subscribers.

I believe it is important that viable ground rules be established to deal with this complex issue, and I congratulate this committee for taking forthright action to try to resolve the matter in the new copyright bill. The establishment of a fixed fee schedule in the legislation is one approach to the problem. Perhaps the fees outlined in Section 111 are fair and realistic. I do not suggest that they are not.

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