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Mr. BLOOM. Is not that what they are here for, because Congress has the power?
Mr. PAINE. Yes.
Mr. BLOOM. If we destroyed all the copyright laws and let them stand on their constitutional rights, then they would come right back to Congress to pass this bill?
Mr. PAINE. That is it, because as far as the Constitution is concerned there are no rights whatsoever given authors or inventors; it merely gives Congress power to give rights, etc.
Mr. BLOOM. The Constitution provides that they shall have exclusive rights for a limited period in their writings and discoveries, that Congress shall have the right
Mr. PAINE (interposing). To grant to them the right.
Mr. BLOOM. That is what they have.
Mr. PAINE. Section 8:
The Congress shall have the power to promote the progress of science and useful arts by securing for a limited time to authors and inventors exclusive rights to their respective writings and discoveries.
If they do not exercise the power, there is nothing here that gives it to them.
Mr. BLOOM. That is why they are here, because they would like these laws.
Mr. PAINE. They say they want to stand on their constitutional rights. They have not any. That is a phrase, "their constitutional rights"; it is a catch phrase, an interesting one, and one which, I think, we must not give too serious consideration to, because it really is misleading. What they mean is, Give us just as broad copyright monopoly as you can possibly give to us. Now, when that time comes, then we must meet on the ground of compromise, because a monopoly always invades the rights enjoyed without a monopoly by other people. When copyright is granted, a monopoly is granted, and these monopolistic rights stretch out and invade the rights of the public as a whole.
Mr. BLOOM. Don't you get your patent monopolies the same as they get their copyright monopolies?
Mr. PAINE. Just the same.
Mr. BLOOM. Under the same constitutional rights.
Mr. PAINE. Under exactly the same constitutional provision. But we do not get, mark you, anything like the copyright proprietor gets in our patent monopoly.
Mr. BLOOM. You do not?
Mr. PAINE. No.
Mr. BLOOM. You can charge whatever you want; you can do whatever you want with it. You can charge any price that you want. Is there any restriction in any way in the patent that you secure from the United States Government?
Mr. PAINE. Yes.
Mr. BLOOM. What restriction is there?
Mr. PAINE. The restriction is that we lose title to it the monute we sell it-the article that is patented.
Mr. BLOOM. Because you sell the article.
Mr. PAINE. Because we sell the article.
Mr. BLOOM. When you buy sheet music, what do you sell, melody? Mr. PAINE. We sell sheet music. The copyright thing is melody, but you do not lose by selling title to the article.
Mr. BLOOM. You sell it for that purpose-reproduce it; you sell melody.
Mr. PAINE. I do not agree we sell melody, because you would part with it after you sold the melody. You are selling sheet music in which melody is embodied just exactly as we sell the patented article, and then we have no further control over it. The patent monopoly does not give us that exceptional control that the copyright 'monopoly does to the copyright proprietor.
Mr. BLOOM. It does not regulate prices. The patent monopoly does not regulate prices in any way.
Mr. PAINE. No; I do not see that the copyright monopoly regulates prices.
Mr. BLOOM. It does in your case.
Mr. PAINE. NO; that is just a small part of it, a very necessary part.
Mr. BLOOM. If it is so small why talk about it? Pass it over. Mr. PAINE. Because it is a large part to us. But I mean the copyright proprietor who monopolizes, it is just a part of the monopoly that he has prices regulated on. There is no attempt to limit in any way his monopoly. The situation is this. When a copyright is granted to a musical composer, he has under the law the exclusive right to print, to reprint, to publish, to copy, to vend, to transcribe, to publicly perform, to arrange, to mechanically reproduce. That mechanical reproduction is just one-ninth; I do not know whether I enumerated them all of the great number of things he is entitled to do with his composition, so that when the rate is fixed for that particular use it is not in any way a limitation of his general monopoly.
I know that in many instances the idea has been brought to this committee's attention that a song writer ought to be on exactly the same position as a singer. The song writer ought to be able to bargain, that his right of bargaining has been taken away, whereas the singer is in a position to bargain freely, and that the song writer has contributed just as greatly to the success of the record as the singer has. I think no more fallacious argument has been presented than that, which seems to indicate the correctness of a position of that sort. The musical composer, if on the same par with his singer, unquestionably has the free right of bargaining. If I write a musical composition, I can get any price I want, go to any talking machine company and demand anything I might desire to demand from that talking-machine company, just exactly as the singer can do, but, on the other hand, as the song writer, I can also elect to go to the copyright office and by publishing my work take out a copyright on it, and then I get all kinds of rights given to me, a tremendous extension of my monopoly, and the singer when she contracts to sing, or he contracts to sing, has to get everything out of it at one time, because when that is done there is nothing else to be gotten, the singer is done, finished, and has gotten his or her whole bargain there. Mr. BLOOM. But she continues to get it.
Mr. PAINE. In the shape of royalties which the singer has bargained for.
Mr. BLOOM. Gets 5 or 10 cents a copy.
Mr. PAINE. Absolutely; because that is the only bargain the singer can make. On the other hand, the copyright proprietor, if I elect to copyright, if I compose the music, I can go to the Victor Talking Machine Co. and get 10 cents a copy exactly as the singer, but I do not elect to do that, I elect to be able to get my cut in on all the thing. Mr. BLOOM. If you do not copyright it?
Mr. PAINE. If I do not copyright it. Then I am on a par with the singer. But I can elect to take out copyright and get a right to publish, etc., get all I can out of the sheet music and out of the arrangements that are made here, there, and everywhere, and the rights-I do not remember all the various rights that are given to the music monopolist. That I can elect to do, and in that instance, then, only one of the small rights which are granted is the right of mechanical reproduction.
Much has been said, too, on the fact that the price of 2 cents, as provided for under the present law, is an absurd price, and yet it is overlooked in many instances, the royalties that mount into thousands of dollars annually in connection with this; and it is overlooked, too, that the 2 cents which is paid to the copyright proprietor for this particular rendition is paid by the Victor Co., and by the Columbia Co., and by the Aeolian Co., and by every company that uses it, although the mechanical-reproduction use might be 6, 8, or 10 cents instead of 2.
Mr. BLOOM. Does the same thing apply to the singer if she sings with all the companies?
Mr. PAINE. Yes; and then she gets a much lower rate.
Mr. PAINE. Yes; and so can the composer when he composes his music. He has the absolute right of bargaining there. Mr. BLOOM. Provided he does not copyright?
Mr. PAINE. Provided he does not become a copyright proprietor. If he elects to do that, he has the monopoly extended and a final extension to 1909 with certain limitations.
It seems to me, however, that there is no use in taking up any further time in connection with the general opposition to the bill, because there are various other points that have been brought out in the courts of the hearings which I feel can be more ably answered by those others of my colleagues representing other mechanical interests, who will touch on the other side of it. But I do want to say in conclusion that the talking-machine industry is a vast industry; that the mere fact that only a few of us have come down to these committee hearings day in and day out to fight the battles of that industry does not begin to be or should not be a measure on the part of the committee as to the great opposition that any elimination of the compulsory license provision of the law will bring to this committee.
As to the rate at which we pay, we feel, as far as my company is concerned, that it is a just and equitable rate. If Congress feels otherwise, we are entirely agreeable that shall be changed; but as to the need of the industry to have available to it at all times such
music as it may desire to mechanically reproduce, that is vital, and it is very important that Congress protect the industry when it has an opportunity to by seeing to it that at all times music which it needs in its industry is available to it.
Mr. BLOOM. Don't you have a monopoly with your singers, sign your singers exclusively, orchestras, and everything?
Mr. PAINE. We try to in as many instances as we can.
Mr. BLOOM. There is no law-no one has ever asked that monopoly should be taken away from you people?
Mr. PAINE. No.
Mr. BLOOM. You have a monopoly in your patents and everything else?
Mr. PAINE. We have a monopoly in patents, if you wish to call it that. It is not that anybody else can not use those intimate patents of the Victor Co., the Columbia, or the Brunswick; it is not such a monopoly that nobody else is able to step into the mechanical field and do business there.
Mr. BLOOм. If you sign a singer for 10 or 20 years they can not get that singer.
Mr. PAINE. But, on the other hand, they have another singer that they have signed up for 10 or 20 years. There is no monopoly in the talking-machine industry in the real sense of the word monopoly.
STATEMENT OF H. R. LAMB, 49 WALL STREET, NEW YORK CITY
Mr. LAMB. I represent the National Association of Book Publishers, and I will say at the start that I am deeply conscious of the responsibility of representing that organization, and, furthermore, to explain that I am not greatly informed generally, I will say that I have no knowledge of the law of copyright, but I am appearing in the absence of my associate, Mr. Seligman. Certain points have been made by some of those who are opposed to this bill that it affected the book publishers' association, and briefly I will touch on some of those.
This morning Doctor Raney, who represents the American Library Association, read a long statement to you in which he condemned the provisions with respect to monopoly and importation. I have read that statement, and I think that Doctor Raney is not only unfair, but some features of his almost vituperative statement are entirely uncalled for.
In the first place, as I understand the history of this bill, it has been a matter of conceding and conceding from time to time to the authors in an effort to aid them in the protection of their property; that is, the product of their brains. The publishers, of course, have had to make concessions, and a very large concession has been made by American labor. As I understand, the present law requires that before a foreign author is entitled to copyright in this country the foreign work must be published in this country. I understand that American labor, doing its part to help the authors in the preservation of their rights, has given up claim to that, and that is evidenced in the proposed Vestal bill. Now, in so far as the Vestal bill will preserve for the foreign author his copyright property in this country, we believe that it is sound on the theory of a sound copyright
law; that the obtaining of the rights to publish the foreign work in this country should carry with it some provision whereby the importation of foreign works should be prohibited, and that, of course, is expressed in section 31 of the bill.
That is the essence of the theory which I understand is sound copyright law, namely, that there is to be recognized a divisible market for the owner of a copyright; that is, an author can grant rights with respect to drama, motion pictures, and other rights of that character. So it also follows that he may grant rights as to the territory in which the right may be exercised. That is sound; and, as I understand it, it is the consensus of opinion that that condition must exist if the United States is to adhere to this Berne convention which has been discussed. If we accept that and we believe that we should join the Berne convention, and if it should be clarified so that we can do it, if the American publisher obtains the right to publish the work of a foreign author, he pays for that right, and the American law, we believe, ought to secure to the American publisher that right. Furthermore, if American labor has given up its present right to have the foreign work printed in America, I think it is only fair that if the American publisher is to be protected in his right that the American laborer should have the benefit, whatever it may be, of having the popular foreign works published in this country; that is, the book should be manufactured in this country, so that he gets some quid pro quo for having given up his present right to have the foreign work printed here in order that the foreign author might have the American copyright.
That, I take it, is inconsistent with the fundamental theory of the divisible market, which, as I say, is expressed in the Vestal bill. Now, Doctor Raney, not talking at all to the fundamental principle that is involved, but harping not only on the collateral issues, but making some misrepresentations which I will not take time to go into now, places the objections of the library association almost entirely on the matter of convenience. That is, he maintains that if the Vestal bill is enacted in its present provisions it will be inconvenient for the scholar and student of America to import the foreign editions for their scholastic purposes and use in libraries.
I will talk chiefly to that matter, convenience, because I think it is grossly exaggerated. If you are a surgeon or any other kind of professional man and you want to get some very fine instrument or serum that is manufactured abroad, I think it is the most natural thing in the world for you to go to an American druggist to obtain the foreign product, and you can almost take it for granted that if this American seller is on the job he will have available to you the foreign product. The same thing is true, irrespective of the technical provisions of the law, in the book industry. We are informed that at the present time by far the larger per cent of foreign editions of foreign books are purchased through American selling agencies. I am informed that it is the practice of New York libraries in New York City to buy their books entirely through American agencies, because it is recognized that the American agency will be on the job and have those available. It is just the same as if you and I want to buy a Dunhill's pipe. We do not send to London; we see if it is. available in the American market. We know it is available and we 98974-26-15