We have a case in Kentucky where they went in and accused a fellow of playing music. He said he did not. They said, "Well, here is your summons. His attorney said, "Your facts are there but it will cost you $200 for the defense." They settled for $100. If you let them go without a limit it will be a destructive force, not alone for us but for these authors and composers. There is very little else I want to say at this time. There is another hearing next week before the Patent Committee of the House on a number of bills that have been introduced, but I shall not take up very much time in view of the promise made to you and the courtesy you have extended. I appreciate it, and I ask leave to submit an additional brief in response to some of the remarks that were made yesterday. The CHAIRMAN. We shall be glad to have it. Mr. COHEN. I also ask that you permit Mr. Handy, who is the representative of some of the theater owners of Kansas and the Middle West, to say something after Mr. Tuttle has finished. Senator DILL. Mr. Chairman, before Mr. Tuttle starts, for fear I may forget it, I have a request from Doctor Herdmer, one of the directors of music here, who would like to appear in favor of the bill. I told him we would not need him this afternoon, but I would ask permission that he be permitted to file a statement with the committee. The CHAIRMAN. If these gentlemen desire to be heard I am going to try to hear them this afternoon. I am going to continue until I o'clock. Senator DILL. If we do not continue, I want permission to let him file a written statement. The CHAIRMAN. All right. REPLY STATEMENT OF MR. CHARLES H. TUTTLE, OF DAVIES, AUERBACK & CORNELL, NEW YORK CITY, REPRESENTING THE NATIONAL ASSOCIATION OF BROADCASTERS Mr. TUTTLE. Mr. Chairman, the discussion that has been before this committee for a number of days has taken quite a wide field, and I think it would be well and perhaps the most helpful thing that I could do to draw the discussion back to what I conceive to be the real point at issue. In order to do so, it is necessary to begin with the proposition that this bill and this case that have been made here are limited to radio. This is a radio case solely, and there are two things that have been said by the other side which emphasize the importance of that primary consideration. In the first place, with commendable candor, Mr. Mills has said that radio-and I think I quote his exact words is the greatest blessing that science has contributed to man. And I want to quote another expression that he used, in order to bring before you clearly the real issue in this case. He said at one point that it could not be made cheaper, so far as the public was concerned, because now it was free.. We have, therefore, a situation which involves a growing industry on a most exceptional basis, an industry which on one side may have its commercial aspect in connection with certain stations, but which, taken as a whole and by and large in their words, is giving mankind, and particularly the American public, the greatest blessing that science has contributed to man. We have also the extraordinary factor that that is being done free. Both of those confessions are made by the other side, and it is important that they be kept clearly in mind, because they present a situation which is exceptional if you look at this thing from the commercial standpoint, and it certainly is most vital and essential for you to look at it from a philanthropic and humanitarian standpoint. Now, what is the connection between this bill and this extraordinarily unique situation? In England, as I am informed, a solution has been found for what might be called the radio problem by the Government setting in and licensing the receiving sets, for which the Government receives a tax, and that tax through various means not necessary to go into is issued to support the radio proposition. Senator DILL. Radio broadcasting, you mean? Mr. TUTTLE. Radio broadcasting; yes. That is the way the solution is found there. But now we have this wonderful infant miracle, which, in one sense, is industry, if we wish to use that term, and is in another sense this infant blessing which is being given to mankind and being given free in this country. The question is--and it runs all through the argument that the other side has presented to you-whether as a matter of public policy Congress is going to say that the uniqueness or basis on which this is being done shall be changed and that commercialism, which is overtaking many another blessing which has come to mankind, shall overwhelm this also. That is the real issue. And when Mr. Thomas said to you that the issue before you was a problem of statesmanship he spoke a very profound truth. This is not a case of one association against another association; nor is it a case of private right here and private right there. But it is simply a question whether this unique situation, carrying with it this great blessing of freedom of the air, is to be perpetuated, so far as the public is concerned, or whether you are to accept the suggestion of the other side that in some way the public shall be made to pay. Because they justify their claim that we should pay them by the proposition that we should put it off on the public. In connection with that suggestion which comes now, apparently, only from a single quarter, and in connection with the logic that we should pay them because we should charge the public, you want to bear in mind this situation, that they are only one of many interests. And they are only one of the many institutions that are interested in having Congress accept that principle, because, as Mr. Mills himself has said we should pay not only the society, but we should pay the musicians and the performers. And you can imagine how that suggestion is going to fall into willing ears, and how fertile that seed will be now that it has been dropped into the ground. And you gentlemen can see what the consequences will be of taking this infant industry and having everybody who has any connection with it alive and responding to the idea that they can tax it, tax freedom of the air in some way, so that this great blessing to mankind will become tributary to them, and annex it to the great commercialism that they wish to have set up in that connection. Mr. Mills, at this meeting with the broadcasters from which I have already read, in September, 1922, put the issue that is before you, the problem of statemsanship that is before you, in a way which he perhaps did not appreciate, because it was excellently done so far as language is concerned, but the implications to the discerning mind are perfectly obvious. He said-I am reading from page 56 of the report: I think, of course, that the cost of broadcasting should be defrayed by those who receive the entertainment, but this seems impossible of arrangement. I want the committee to note these words: "But this seems impossible of arrangement.' And then he proceeds: Because when you once put something into the air, anyone with a set can listen in and you can not stop it or control it or charge him for that privilege. At the same time, broadcasting is going to have to be put in the hands of skilled entertainers, men who know how to furnish amusement and entertainment, and it is going to cost a lot of money to do it, and to maintain the service. You have before you as big a problem as is before the theatrical men of the country-to furnish entertainment. And it is going to cost a lot of money to do it and to maintain the service. I should undertake to say in reference to his statement about the problem being greater than that before the theatrical men, that it is far greater, because theatrical men can put on a fee, pass the cost on to the public; and far more because the public are accustomed to have them do that. But he continues: To furnish entertainment, and to millions of people, you are going to require the services of skilled purveyors of amusement and professional talent. And he goes on to say: That, to me, is your big problem, and how to meet the mounting costs that will be associated therewith. The minute you solve that problem, the problem of selling sets will solve itself; you won't be able to fill the demand. You have in that, therefore, in the first place, the suggestion which is bound to become public, has been made public here, that not only they but all who take part in furnishing this public entertainment are to look at it as an opportunity for tribute for themselves. And the consequence of any argument with broadcasters on that proposition are immense, because they are, in effect, saying to us: Unless you yield the tribute of the air to us we will array against you not only our own combination, solid as it is, 100 per cent, but we will bring against you the unions. In this situation which choice will you take? When you look at it also from the other standpoint, as to what was said here by Mr. Mills That the cost of broadcasting should be defrayed by those who receive the entertainment. In other words, the proposal is to shift the entire basis of this enterprise as it is now conducted. Because, whether or not the broadcasters, in their desperation, may have to turn to some kind of advertising or not, in order to get from the advertiser a means of carrying on, there has been no suggestion that the broadcasters have ever made the proposition to shift the basis of the service which they are rendering and try to charge the public. And that is the question of statesmanship, gentlemen of the committee, which you are presented with. But even if we did try to shift the basis, how are we going to do it? I have listened for a day to the suggestion that we should charge the public, as a justification of the fact that they are charging us and bringing in their allies to do likewise. But I have listened in vain for any suggestion of how it can be done. And that is why I am saying to you, as a problem of statesmanship you are dealing with a unique situation. Because we are providing a form of public recreation, health, and education, which presents a questions, even if we wanted to put it off on the public, how could we do it? And what is the answer that Mr. Mills has given to that? He says this seems impossible of arrangement. And because he has stated that then he has not ventured, neither have those who have spoken on that side ventured, to suggest any way of doing it. Will they come forward and tell the American people the truth, that they want the English system adopted-of taxing the receiving sets and turning the taxes over to the broadcasters? Never! Now, consequently their entire argument and I am taking it now from what you will agree with me is the real issue in this case-their entire argument comes down to two principles, not openly expressed, but one of them is, that they demand that Congress and the American people and the broadcasters accept the principle, which was never dreamed of when this copyright law was made; accept the principle that they are to have the sole right, by combining their copyrights, by combining their rights in the public performances, the sole right to be judge and jury of what the air, this common heritage of everybody, shall pay them. The moment you accept that principle it requires no far-seeing mind to see what the consequences will be. I am not exaggerating when I say that of course at the present time they are on their good behavior, while that principle is still in debate. We are in the same position as the mouse who accepts the friendship of the cat's paw. There will come a time when playing with us ceases, and there will begin a time when mastication begins. On the other hand, if that is not so, we have the other principle, and that is this: That we are to join with them; that is their solution; join with them in denying to the public the freedom of the air. They say: Come with us. Put your hand in ours. We will show you how to handle the public. Make a combination which will out-combine anything that the world has known so far as monopolies are concerned; combine freedom of the air with the music of the country, in one single working arrangement, and charge it all on the public. Now, gentlemen of the committee, that is the question that is the issue to which this bill is directed. And it is an issue of public policy that underlies this whole discussion, and which is being camouflaged by trying to shunt it off on the private rights of 326 people. Now, I have said that only the radio is involved here, and I want to make that plain. There has been some suggestion made that in a certain way the radio might be hostile to the hotels, or hostile to the theaters, or hostile to the moving picture houses. The theaters of the city of New York can not hold the people at the present time. The musical comedies, even where they have their music broadcasted on the air, and they are frantic to get the privilege of doing it, can not hold the people. And it is the same way with reference to the moving-picture theaters. And surely we do nothing but confer a blessing on the hotels. Some suggestion has been made here by some of the speakers, halfheartedly it is true, but it has been thrown out, that in some way or other this bill attacks grand opera and plays as a whole. I do not see what sincerity can be behind such a suggestion unless it is based on ignorance of the copyright law, because this copyright law, sir, makes a distinction between what it terms musical compositions, on the one side, and what it terms dramatico-musical compositions, on the other. They are treated differently. They are in different classifications. A dramatico-musical composition, of course, is an opera. It is a musical comedy. It is the thing as a whole. This bill does not touch, does not propose to touch, either one of those, because it is a mere amendment of subdivision (e) of section 1 of the copyright law; and that section is, in terms, confined to musical compositions. And this amendment is in terms confined to musical compositions. So that we have this fundamental thing, that this vast agitation about grand opera, and about plays as a whole, has nothing to do with this situation-although, believe me, there are plenty of playwrights who welcome the opportunity to put their plays as a whole on the air, have sought us out, and have been delighted with the results. Because people want to go and see the play which carries the music. Now, gentlemen of the committee you Senator DILL (interposing). In that connection, Mr. Tuttle, do know what the result has been to the Capitol Theater, in New York, of its broadcasting? Mr. TUTTLE. That is an excellent suggestion. The Capitol Theatre is the largest moving-picture house in the world. The CHAIRMAN. Where is it? Mr. TUTTLE. At Broadway, in the Forty-second Street area in New York City. And they actually run the broadcasting station with the very purpose of drawing people into the moving-picture house. And that theater is crowded day after day. Mr. COHEN. May I inject there that the crowding of that theater has practically emptied every other theater in that territory? Senator DILL. They broadcast every Sunday night, I believe? Mr. TUTTLE. Yes, sir. Mr. COHEN. There are two theaters in New York City that broadcast and the others do not. Those two have emptied the other theaters in New York and its environment. Mr. TUTTLE. That is absolutely a mistake, I think, but I will say that it has popularized the music which they play. [Laughter.] Is there anything funny in that? Mr. EMANUEL J. STUTZ. It has emptied my house on Sunday night, and I am in Chevy Chase. The CHAIRMAN. You may proceed, Mr. Tuttle. Mr. TUTTLE. I am not, of course, an expert in the moving-picture business, but I am one of the public when I come to that section. And I have been in the Forty-second Street area, to which these gentlemen have referred, though I have never been in the Chevy Chase section of this city, so I can not speak of that, but I would say |