Mr. SWIFT. Thank you.

Mr. Turner.

STATEMENT OF R. E. TURNER III

Mr. TURNER. Mr. Chairman, members of the subcommittee, my name is Ted Turner. I am president and chairman of the board of Turner Broadcasting System.

I appreciate this opportunity to testify as to the communication policy implications of H.R. 5949, a bill to amend the Copyright Act of 1976.

As you know, Turner Broadcasting operates three different television networks that provide sports, entertainment, and news programing to the public over cable. Twenty-one million cable homes now receive home games of the Atlanta Braves and Hawks, approximately 27 percent of the homes in the country.

Fourteen million cable homes now receive the Cable News Network, providing 24-hour in-depth news coverage and commentary. These networks are extremely expensive undertakings that exist in a highly competitive marketplace.

Their continued viability is thus highly sensitive to Government regulation that may impact competition in that market. I know I share your concerns, Mr. Chairman, that Government adopt no regulation unnecessarily restricting competition in the delivery of cable services to the public, or that would undermine the diversity in media voices the public is entitled to receive.

At the outset, we believe H.R. 5949 will impact television competition and information diversity in several ways. First, the syndicated exclusiveity provision requires cable systems, with certain exemptions, to black out syndicated television programing upon the request of local commercial broadcast stations. This restricts cable's ability to compete with broadcast television and denies the public time diversity in the programing it may receive.

Second, the bill requires cable systems to retransmit the signals of local, independent, and network affiliate TV stations. This gives an unfair preference to the three major broadcast networks whose programing must always be carried at the expense of the four dozen other television networks now available by satellite.

On the positive side, the bill also fosters competition and diversity. First, it prohibits FCC regulation of the number of distant broadcast signals a cable system may carry. This may expand the number of program services delivered to the public.

Second, section 101 of the bill clarifies the original intent of the 1976 Copyright Act that satellite carriers of television programing are exempt from copyright liability if they exercise no control over the content of the programing they provide to cable systems. This is essential to protect the information needs of nonurban Americans who rely on cable satellite programing for diversity and for information parity.

Representing a carefully crafted compromise of affected industries, it is not surprising that this bill has ambivalent effects on competition and diversity. On balance, however, it is a satisfactory bill that meets the public interest. Hopefully, it will establish peace between the cable, broadcast, and motion picture industries, per

mitting them to shift their competition from Congress to the marketplace where it belongs.

This objective would be threatened, however, by addition of unwarranted amendments. Of greatest concern is an amendment requested by professional sports to prohibit the retransmission of a television broadcast of any professional sports game over any cable system located near the stadium of any team in the same league absent the consent of that team.

The bill currently permits a team to control the television exhibition of its own game in its own market. This amendment would grant a legislative monopoly to each team to control the exhibition of the games of other teams. Under this proposed sports amendment, for example, hundreds of cable systems would be required to delete the Atlanta Hawks and Atlanta Braves games carried on WTBS, destroying the audience and advertising revenue base of the superstation. More important, millions of fans would be denied the sports diversity the superstation had provided them for a number of years.

There is no need for this protectionist restriction. The value of sports franchises has increased dramatically in recent years, as have team revenues, player salaries, et cetera. Morever, as an owner of two professional sports teams, I know that home game attendance is dependent on market size, team performance and the competence of management, not on cable's carriage of sports or broadcast either for that matter.

Finally, the amendment is not needed to protect weak teams. The restriction is not limited to the cities with weak teams, it applies nationwide, and protects some of the wealthiest individuals in America owning these teams. Their teams already receive Government support through depreciation and income shelter and tax loopholes, and through municipal subsidization of their stadiums. Professional sports needs a government mandated monopoly like the Arabs need more oil. The average baseball salary is now over $186,000 a year, three times that of a Congressman, and ten times that of a school teacher.

Second, most teams are creating regional pay TV sports networks. They have asked for this legislative monopoly not to protect the weak teams, but to protect these pay networks from any competition from services like WTBS the superstation.

Finally, the leagues have done little, the ones I am speaking of, to solve their own problems. No effort has been made by baseball or basketball, for example, to copy the revenue-sharing plan of the NFL, which assists the financially weaker teams in the smaller markets.

Mr. Chairman, the sports issue is not a communications problem. No public interest will be advanced in granting a television exhibition monopoly to the few millionaires who own sports teams at the expense of billions of ordinary hard working Americans, or sports fans.

Thank you for the opportunity to testify. [Testimony resumes on p. 224.]

[Mr. Turner's prepared statement follows:]

STATEMENT

OF

R. E. TURNER, III

CHAIRMAN OF THE BOARD AND PRESIDENT

OF

TURNER BROADCASTING SYSTEM, INC.

Mr. Chairman, Members of the Subcommittee, my name is Ted Turner. I am President and Chairman of the Board of Turner Broadcasting System.

I appreciate this opportunity to testify as to the communications policy implications of H.R. 5949, a bill to amend the Copyright Act of 1976. Cable television, as you know, is one of the fastest growing and most dynamic of all the communications technologies. Turner Broadcasting is

privileged to be a key part of this industry.

The

Our particular segment of the cable business involves the provision of sports, entertainment and news programming to the public. Over 21 million cable homes in all 50 states (90% of all homes enjoying cable service) now receive the signal of WTBS Atlanta the Superstation. primary, basic entertainment service offered by cable, WTBS broadcasts diversified family information and entertaining programming including movies and the baseball and basketball home games of the Atlanta Braves and Atlanta Hawks. For millions of Americans it represents the primary alternative to the humdrum, look alike programming of the three commercial television networks.

Within the last two years, we have initiated two, all new, cable television networks: CNN and CNN 2. Now available nationwide to over 12 million cable homes, CNN provides 24 hour, in depth news coverage, feature programs and commentary on the issues and events shaping our world.

CNN 2, inaugurated just last January, already reaches 1

million homes across the nation with a quick response, news headline service.

With their worldwide newsgathering sources and

satellite technology, the Cable News Networks can go anywhere, instantly, to get any story. With a 24 hour broadcast

format, they not only can stay with a story to its conclusion, they provide a level of analysis and access to divergent viewpoints and ideas not otherwise available.

Together,

they provide an information alternative to the cable subscriber far superior to conventional news media.

These networks are fledgling and extremely expensive undertakings, Mr. Chairman. Because communications is such a highly regulated industry, the economic viability of these networks is highly sensitive to government regulation. Accordingly, we are deeply concerned that government not adopt any regulation that would unnecessarily restrict competition in the delivery of cable services to the public or that would undermine the diversity in media voices the public is entitled to receive.

In our opinion, H.R. 5949 impacts television competition and information diversity in several ways. First, the bill reintroduces modified, syndicated exclusivity protection requirements recently rejected by the FCC and the Courts. It requires cable systems, with certain exceptions, to blackout syndicated television programming upon the

request of local, commercial broadcast stations.

This

restricts cable's ability to compete with broadcast television

and denies the public time diversity in the programming it may receive.

Second, the bill requires cable systems to retransmit the signals of local, independent and network affiliate TV stations. This gives an unfair preference to the three major broadcast networks, whose programming in effect must always be carried, at the expense of the four dozen other television networks whose programming is now available by satellite but is not required to be carried. When you

consider the terrible quality of the programming of the broadcast networks

-

emphasizing sex and violence, and

encouraging disrespect for our laws and social values, as

On the positive side, however, the bill also

fosters competition and diversity in several ways. First, it prohibits FCC regulation of the number of distant broadcast signals a cable system may carry. This potentially expands the number of program services that may be delivered to the public, although the syndicated exclusivity requirement weakens this provision somewhat.

Second, Section 101 of the bill clarifies the

original intent of the 1976 Copyright Act that satellite and