users of the system. So it won't cost the American taxpayers any money directly. Mr. MOORHEAD. This bill provides the formula for handling home taping of music only. Could the same formula be used for home taping and home copying generally of other material? Mr. OMAN. What you have determined in drafting the legislation as you have, limited to the digital technology, is that in the normal analog field the likelihood of a copy made at home displacing a sale is much less likely than in the digital format where you have a perfect copy made. And, under those circumstances this distinction is a logical one and one I think that will be borne out in experience. When someone has the money to buy expensive DAT machines and buy the expensive blank tapes, one has disposable income that could be used to buy the tapes prerecorded. The fact that many of the people who use the analog technology, the teenagers with limited income who don't seek the high quality in their analog copies, generally aren't the ones with the disposable income that can buy the prerecorded tapes. So it is not displacing a sale in many cases. And that is the determination I think you have made in drafting the bill and limiting it to the digital technology, because it is in that medium that the studies show that taping at home displaces sales. Mr. MOORHEAD. The chairman alluded to one other situation, the fact that the bill is so long, 57 pages long, and a tremendous amount of the details deals with the auditing of the books. I wonder as far as litigation is concerned whether that tremendous detail will alleviate potential legal battles in court or will it be something that causes more of them as people argue over more and more terms and find more areas in which they can? Mr. OMAN. In this particular case, since the solution is so rooted in technology, I think the detail will eliminate confusion down the road and will make lawsuits less likely. Mr. MOORHEAD. Well, I know what an important role you have played in all of this, Mr. Oman, and we appreciate your action and your activity in bringing the parties together. This has been a very difficult issue to solve and I know it is necessary that someone who is well aware of all of the people involved and all of the issues involved to get into it as you have. So I think that you deserve a great deal of the credit for bringing this legislation before us. Mr. OMAN. Well, you are kind to suggest it, Mr. Moorhead. But, if the truth be known, we were very much on the sidelines and it was the parties themselves who really have put it together, and they serve all the credit. Mr. MOORHEAD. You are modest, anyway. I have just one additional question. The SCMS copying prohibition reaches material not protected by copyright. That seems to be so because all materials which are not electronically encoded as noncopyright materials are considered to be copyrighted. My question is, there seems to be no provision for changing the treatment of material once copyright expires. In other words, for purposes of serial copying, material having copyright-protected encoding would not use that encoding. Am I correct in that assumption? And does that give you any concern? Mr. OMAN. It was a concern that we had, and it is still a concern. We had concluded, however, what the expected life of a recording was, even though the expected life in the digital format is greater than in the analog format, it still is limited by the physical properties of the media, and that a prerecorded tape that is issued with the encoding on it today cannot be expected to physically last for the duration of copyright. In the life of the author plus 50 years, new recordings will be made, and if the work is in the public domain, it could conceivably be made without the encoding on it or it could still require the encoding because the sound recording itself is protected under copyright. think in the long run you will find that the duration of copyright mitigates any unfairness that might creep in with the coding not being erased at a certain time in the life of the music, and I do think that it is in many ways a theoretical problem rather than a practical problem. Mr. HUGHES. Thank you. I have no further questions. I just want to thank you for your help once again and tell you that I have known and I am sure we have known on the subcommittee for a long time that your office enjoys a terrific reputation in this country, but I am happy to say that I observed firsthand just how highly regarded our own Copyright Office is in the international community. My recent visit to the World Intellectual Property Organization, where I was privileged to speak this past Monday, was very instructive in that regard. And I just want to congratulate you on your professionalism over the years and thank you and Eric Schwartz in particular, and your staff for the splendid job they did in making my own visit to Geneva and with some of the organizations in France so productive. Thank you. Mr. OMAN. Thank you very much, Mr. Chairman. Mr. HUGHES. I would like to introduce our first panel of witnesses this morning representing the recording and electronics industries. I would like to commend you for your important work and for the compromises that each of your organizations made in order to reach an accord that will assure the protection of copyrights and provide consumers with new and important products. First, I would like to welcome Mr. Barry Manilow, a renowned performer and songwriter, whose credits include some of our most cherished American musical classics. I think we will have a chance in just a few minutes to hear Mr. Manilow's music on the digital compact cassette player. We're just delighted to have you with us today, Mr. Manilow. Second, I would like to welcome Mr. Stanson G. Nimiroski, the vice president and manager of the Sony Music Entertainment manufacturing plant in Pitman, NJ, which is in my congressional district. We're very proud to have them as corporate citizens in Gloucester County. Third, Mr. Joseph Smith, president and chief executive officer of Capitol-EMI Music, Inc. Testifying also is John Roach, the president and chairman of the board and chief executive officer of Tandy Corp., and Mr. George David Weiss, also a highly acclaimed songwriter and president of the Songwriters Guild of America. Mr. Cary Sherman, an attorney with Arnold & Porter, is accompanying the witnesses today. We are delighted to have each of you with us. We have your full statements which, without objection, will be made part of the record, and you may proceed as you see fit. Why don't we begin with you, Mr. Manilow. We welcome you today. STATEMENT OF BARRY MANILOW, RECORDER AND SONGWRITER, HOLLYWOOD, CA Mr. MANILOW. Thank you, Mr. Chairman. Thanks for the opportunity to testify in support of H.R. 3204, the Audio Home Recording Act. am Barry Manilow, and I come before you today as a BMI songwriter, as a musician, recording artist, music publisher, and consumer. But I also represent thousands of others in the music industry. This legislation is of paramount importance to the music community and to consumers. It will provide compensation to the creators, producers and performers of music when copies of our work are made at home by private citizens. It will give consumers access to the most innovative and exciting new digital audio technologies that the market has to offer. But more than that, it will protect consumers from copyright infringement lawsuits whenever they copy music at home for their personal use. Finally, it will continue the great tradition of America's copyright law which fosters the creative spirit by preserving incentives for songwriters, musicians, performers and record companies to produce music. By ensuring a fair return on our investment of time and talent, Congress will guarantee that America's music community will continue to be the world leader in the production of recorded music. You know, I've been very lucky. I'm proud of my achievements and I am proud of my music. But I'm not just here on behalf of myself today. I am here on behalf of thousands and thousands of struggling American songwriters, musicians and performers and generations of talent to come. I am also here on behalf of the people who the public never hears about-publishers, recording engineers, producers, background vocalists and musicians, A&R executives, promoters, marketers, distributors, and, of course, the record retailer. These are just some of the people who help bring music to the public. So, you see, it's for all these individuals that I appear before you today to get support for this important legislation. You know, songwriters, performers and musicians earn their money pennies at a time. It's a struggle to make ends meet getting paid like that. For every record sold, one only earns a few pennies. Only a few of the biggest super stars get paid up front. Most of us only get paid when a record sells. If you're lucky enough to get a hit, it's great news. It means that people like our songs. But the bad news is that it's primarily the hits that get copied; it's the hits that get taped. Of course, I would rather have a hit, but when someone makes a copy of our work instead of buying it, it is just not fair. Home copying threatens our livelihood. This threat is greater today than ever before because of digital technology. Digital technology is great, it's fantastic. Because of digital technology, music sounds extraordinary. As a producer and as an artist, no one appreciates the advance of new technologies more than I do. It has been very exciting to work with digital recording in the studio. But now anybody can make a perfect copy of our work at home. With digital technology, the 100th copy is as perfect as the first. If perfect copies can be made for only the cost of a blank tape, why purchase the original? Why pay for a prerecorded cassette or compact disk when you could get a digital copy from a friend that is as perfect as the original, or when you can tape perfect copies off the radio? So, you see, it's not pleasant for me to read about blank tape sales. That is why I'm here today on behalf of this legislation. This legislation can only bring positive benefits to us all. By providing royalties on blank tape, this legislation will effectively remove the fears associated with digital recording technologies and permit songwriters, musicians and performers to join hands with consumers to embrace these fantastic new products. Also, this bill provides for a limitation on the ability to make digital copies of digital copies by requiring that all nonprofessional models of such equipment incorporate the Serial Copy Management System, the SCMS. This way consumers will gain access to exciting new technologies free from the legal hassles of the past. We musicians want the best possible equipment available to deliver our music. The higher the quality of the equipment, the better our music sounds. No one in the music community has enjoyed being labeled as antitechnology just because we're concerned about the need to protect our rights, our copyrights. We have always wanted our fans to hear what we create in a setting as close to studio perfect as possible. But so far the consumer has been denied access to this great new technology because of the legal climate surrounding the introduction of DAT and other products. This bill changes the landscape, permitting manufacturers of new digital audio recorders to bring their products to market without fear of lawsuits and the problems of the past. As it should be, the market will dictate the success or failure of these technologies. I am very excited about all the possibilities that await us. The only dilemma will be for the consumer to decide among all these great new toys available, and that's the way it should be. This legislation will preserve the incentives for American songwriters, musicians, performers and record companies to continue to create music, maintaining our preeminence in the world market. H.R. 3204 protects millions of livelihoods. It provides the financial nourishment necessary to produce the quality and diversity of music we are accustomed to enjoying. Without this bill, the music industry will be on a downhill spiral. Without the protection of this legislation, the music community will lose so much revenue because of home copying that we might never be able to recover. There will be fewer dollars to invest in new talent. We could lose a whole generation of young songwriters, musicians and performers solely from the lack of adequate protection of their copyrights. Record companies would be less willing and much less able to take chances on new talent. Songwriters couldn't make a living. Less popular genres of music, such as jazz, folk or classical, could dis appear. Mr. Chairman, you have taken the opportunity and provided the leadership necessary to prevent this dismal future by introducing H.R. 3204. Please now take the final step by enacting this measure as soon as possible so that American music, in all its richness and diversity, will be around for generations to come. Mr. HUGHES. Thank you very much, Mr. Manilow. [The prepared statement of Mr. Manilow follows:] PREPARED STATEMENT OF BARRY MANILOW, RECORDER AND SONGWRITER, Mr. Chairman, members of the subcommittee, my name is Barry Manilow. I want to thank you for the opportunity to be here today to testify in support of H. R. 3204, the Audio Home Recording Act of 1991. I come before the subcommittee today as a BMI songwriter, but I am also a musician, recording artist, music publisher and consumer. I am also here today to represent thousands of others in the music industry. In the time I've been allotted, I would like to stress three reasons why this legislation is of paramount importance to the music community and to consumers. First, this bill provides compensation to the creators, producers and performers of music for the home copying of our works. Second, it will provide consumers with access to the most innovative and exciting new digital audio technologies that the market has to offer; in addition, the bill protects consumers from copyright infringement lawsuits for home copying of music for their personal use. 66-469-93 - 5 |