to ask you two things. One, prompt passage of this bill by the subcommittee and the full Committee on Energy and Commerce. Time is of the essence. I agree fully with Tom Wheeler when he says that it is unlikely that we can hold this coalition together in another session of Congress. Second, we ask that the bill be passed without amendments. We say this because the strength of this bill is in its balance. It assures that the vitality of the three industries involved will not be sapped by a scheme which may favor one over the other. Also, in terms of the public, we believe the balance in this bill optimizes diversity in competition and that benefits the public. Anyone who has lived through the various attempts over the years to either legislate or regulate in the cable area, knows that you have a real dogfight on your hands. Realistically in this legislative area when you deal with cable, invariably the parties who oppose what you are trying to do will prevail. Broad support is the only way to achieve legislation. You have to distinguish between the philosophical and the practical. I agree with everything that Chairman Fowler and Mr. Wunder have said today about full copyright liability. But their approach is philosophical, it is not practical. We have compromised, as Tom Wheeler pointed out, and it has been a very difficult ordeal. Chairman Kastenmeier about a year ago at the NCTA convention urged the parties to get together and resolve our differences and we have done it. I cannot speak for the other parties, but in the case of NAB, we have given up a lot. We believe in full copyright liability for distant signals. We do not have that in this bill. We believe in full must-carry for all UHF and VHF stations. We do not have that in this bill. Under normal circumstances we would question the exemption in this bill for the so-called resale carriers, the effect of the Eastern Microwave decision. We are not given that opportunity. The cost of this broad support is compromise. Now, it is fair to ask why are we here so soon after the passage of the 1976 copyright law. The answer is because the resolution of this whole matter must be a comprehensive package. We had a comprehensive package in 1976. The reason it did not work was because it was half statutory and half regulatory, and the regulatory aspects were left to the FCC in the form of the distant signal and program exclusivity rules. As you well know, the FCC deleted those rules, thereby dismantling this regulatory scheme designed to compliment the new copyright law. That cannot and should not happen again. We must have one comprehensive statutory package, not half statutory and half FCC regulation. We think H.R. 5949 accomplishes this goal. Now I talked earlier about the public interest aspects of this bill. I think if there is one compelling reason for passage of this bill, it is the benefit to the public that would be derived from the provisions of the bill. Let me talk first about the must-carry rule. This rule promotes competition by preventing the cable system from cutting off the local stations from cable subscribers. I would point out, Mr. Chairman, in some markets cable penetration is up to 80 or 90 percent. Thereby, we can assure that the public will have access to local service, and that stations will have the ability to provide that local service. So that stations can reach all of the people in the market, not just those served by cable, but also those who do not have cable, either because it does not reach them, they cannot afford it, or for whatever reason. Also, in the area of program exclusivity, the provisions of this bill will assure a diverse supply of quality programs by allowing the producers to control, and control is the key word, their programs. So that they can seek a fair return on their investments. If they do not have the right to control, and I think Mr. Railsback pointed this out very well previously, if they do not have the right to control their programs, they will be forced into pay television. I do not think that would be in the public interest. The same is true for broadcasters. Without program exclusivity, they would not be willing to invest in quality programing. If there is fear of duplication by cable importation, they simply are not going to put the money into quality programing. Also, the provision on strengthening the network nonduplication rule will insure the continuation of regional and national networks. I see that my time is up. In closing, I would simply reiterate that this may be the last chance for a resolution of a very difficult cable copyright question, and I urge prompt action and action without amendments. Thank you very much. [Mr. Summers' prepared statement follows:] Statement of John B. Summers Executive Vice President & General Manager Subcommittee on Telecommunications, on H.R. 5949 June 2, 1982 The National Association of Broadcasters fully supports H.R. 5949 and urges prompt action by this Subcommittee and the Committee on Energy and Commerce to report this bill to the full House for passage. NAB also urges H.R. 5949 is a painstakingly and passage of H.R. 5949 without amendments. thoughtfully crafted package of provisions the strength of which lies in its balance. Far more than being a compromise among industries, H.R. 5949 offers a sound, statutory resolution of highly controversial issues which have plagued the Congress, the Federal Communications Commission, the various affected industries, and the public for over two decades. While it does represent the product of negotiation among affected industries and does enjoy their support, it also represents sound public policy. It optimizes diversity and competition to the benefit of the viewing public. At the same time, it assures that the vitality of the broadcast, cable, and production industries will not be sapped by a regulatory scheme which favors one over the other. NAB commends and thanks the National Cable Television Association (NCTA) and the Motion Picture Association of America (MPAA) for their participation in assembling the basic provisions of this legislative package. NAB similarly thanks Chairman Robert Kastenmeier of the Subcommitee on Courts, Civil Liberties and the Administration of Justice, who recognized the need for legislation, encouraged and nurtured the compromise among NAB, NCTA, and MPAA, and introduced and managed the legislation now before this Subcommittee. Mr. Kastenmeier and his staff deserve immense credit for resolving these difficult issues. Also, by way of introduction, NAB wishes to emphasize, but not Each of the belabor, one obvious point. H.R. 5949 reflects a compromise. affected industries made substantial concessions of longheld and tightly embraced positions. NAB, for example, has favored normal copyright liability for cable's use of distant broadcast signals. NAB has favored full "must carry" rights for all stations. NAB would question the applicability of the common carrier exemption in the copyright law to the so-called resale carriers which distribute distant signals to cable systems. Like NCTA and MPAA, however, NAB appreciated the need to resolve the copyright and communications issues arising from cable's use of broadcast signals. With the existing legislative/regulatory scheme "tilted" severely in cable's direction, NAB also saw the need for prompt action, attainable only if legislation enjoyed broad support. The cost of broad support was compromise, often reluctant, but always realistic in light of the need to secure passage of legislation in this Congress. H.R. 5949 is a tremendously significant piece of legislation. It comes in the wake of twenty years' uncertainty created by numerous unsuccessful attempts to resolve these issues. Initially, broadcast stations enjoyed the ability of cable to provide reception of their signals in cases where terrain features prevented good reception of their off-air signals. As cable began to employ long distance microwave links, broadcasters' delight with cable was replaced by concern that cable systems not only would provide better reception in fringe areas and other areas of poor reception, but also would import broadcast signals from distant markets into their local markets. The essence of broadcasters' concern was not fear of competition |