No. 1] COPYRIGHT LAW OF 1976 171 whichever is greater. But there the advance falters. Most of the other changes in the law will result in only the most insignificant increase in the income of the average music writer or publisher, at least for the foreseeable future. Writers and publishers should be aware, therefore, that the new law is not the bonanza that wishful thinkers believe it to be. Three aspects of the new law underscore the fact of its limited economic impact. 81 1. Jukeboxes, which long enjoyed a statutory exemption from performing rights fees," are now required to pay. The requirement reminds me of a scene from Neil Simon's play, The Prisoner of Second Avenue.82 In that scene, members of a family gather together and each agrees to contribute “x” to assist an ailing brother until someone asks, "How much is 'x'?" In the case of jukeboxes, "x" is only $8.00 per jukebox per year, and this sum is to be divided among all those whose music is used on the jukeboxes.83 In other words, the jukebox royalty will be divided among all the members of the three major United States performing rights societies, Broadcast Music, Inc. (BMI), the American Society of Composers, Authors, and Publishers (ASCAP), and SESAC, Inc., as well as among those writers and publishers not affiliated with any licensing society. It is estimated that the total amount collected from the jukeboxes will not exceed $4 million a year, and this is before deducting the expenses of collection and distribution. Thus, the net gain to all American music writers and publishers, whose numbers will likely exceed fifty thousand, plus the tens of thousands of foreign composers and publishers, should be no more than $3 million a year. 2. Statutory liability is now imposed on the cable television industry for the retransmission of copyrighted material which originated on broadcast television.85 This major change should result in additional income to copyright owners. However, the Congressional Committee estimated that the total revenues from the cable industry during the 79. Id. 114. See note 32 & accompanying text, supra. 80. 17 U.S.C. § 1(e) (1970). See note 27 & accompanying text, supra. 81. Copyright Revision Act § 116. See note 28 & accompanying text, supra. 82. N. SIMON, THE PRISONER OF SECOND AVENUE (Avon Books, New York, 1973). 83. Copyright Revision Act § 116. 84. This is computed on the basis of a statutory rate of $8.00 per year on 500,000 jukeboxes in use. 85. Copyright Revision Act § 111. See note 19 & accompanying text, supra. 172 COMM/ENT [Vol. 1 first few years would be in the neighborhood of $8.7 million a year.86 This figure is for all copyrighted material used on cable, including films, specially-packaged television shows, news, sports events and music. There is no exact indication of what music's share will be, but initially it will not exceed $2 million a year. And this figure, too, is before overhead and expenses. 87 3. Under the new law, royalty fees may now be collected for the performance of a musical composition under non-commercial auspices, which includes public broadcasting. Prior law limited such collections only to public performances of a musical composition "for profit."88 However, the earlier law distinguished between music and drama, giving a copyright owner of the latter the exclusive right to perform the work publicly, regardless of whether or not "for profit."89 Thus, for example, if a public broadcaster wanted to present a copyrighted dramatic work, permission of the copyright owner was required. But when the public broadcaster performed a piece of protected music, no such clearance was necessary. This glaring inequity has been corrected," at least in part. Under the new law, the copyright owner has the exclusive right to perform his musical work publicly, whether or not "for profit.""1 However, public broadcasters may still take advantage of a compulsory license for the use of the copyrighted music,92 a benefit which they do not have in the case of other protected works, such as dramas and motion pictures.93 The gross income from these nonprofit performances of published nondramatic musical works cannot be estimated with accuracy; but the figure will not be great. Non-commercial users cannot be expected to pay the same rates as commercial operations.94 Despite some significant changes, it seems clear that the new law will not result in substantial economic benefits for the majority of composers and music publishers. It is not likely that the changes in the Copyright Act will bring about more than a five per cent increase in total performing rights income. 86. H. R. REP. No. 94-1476, 94th Cong., 2nd Sess. 91 (1976). 87. Copyright Revision Act § 111. 88. 17 U.S.C. § 1(e) (1970). 89. 17 U.S.C. § 1(d) (1970). 90. See H. R. REP. No. 94-1476, 94th Cong., 2nd Sess. 62-63 (1976). 91. Copyright Revision Act § 106(4). 92. Copyright Revision Act § 118. See note 19 & accompanying text, supra. 93. Id. 94. See note 22 & accompanying text, supra. 29-909 0-84-6 No. 1] Conclusion COPYRIGHT LAW OF 1976 173 Congressman Edward W. Pattison, a member of the House Copyright Subcommittee who played an instrumental role in securing the passage of the new Copyright Act, observed: There remain unanswered and unaddressed issues. No doubt defects will be discovered in this legislation as it becomes operative. I hope the Subcommittee (of the Judiciary) will address itself to these matters in the next and succeeding sessions of the Congress so that a major revision such as this one will never again be necessary."5 It is indisputable that, in the main, the Copyright Revision Act of 1976 has long been overdue and that its enactment is welcomed by all concerned. In any major piece of legislation, and certainly in any one which has been in the making for over twenty years, there will be areas which will be touched upon too lightly, areas which will be written too expansively, and areas which will be neglected altogether. But one has the right to expect that once Congress undertakes such a monumental task as the wholesale revision of an entire body of law it will carefully analyze the priorities, potential abuses, and ultimate long-range effects of each provision before it gives any new provision its imprimatur. Unfortunately, too often in the Copyright Revision Act of 1976 Congress failed to take into account those things which would have made their revision of the law balanced between the creators and users of copyrighted works. Equally to blame of course were the representatives of the creators and users themselves, who were concerned almost exclusively with their special interests and so failed to take an objective look at the Revision Act in its entirety. Now that the smoke has settled and we have a new Copyright Act, perhaps all interested parties can examine it more impartially and make those corrections which will bring the law into conformity with all of our objectives. Then we can have a copyright law that is fair to both creators and users while at the same time being administratively manageable. 95. 122 CONGRESSIONAL RECORD E5244 (daily ed. Sept. 23, 1976) (remarks of Rep. Pattison). Mr. KASTENMEIER. Both statements are well written, well reasoned, and I commend them to my colleagues. I would also like to thank Mr. Stern and Mr. Cramer for taking the time to formulate their views on the broad issue of the impact of new technologies on copyright law. In this regard, I would encourage industry representatives, trade associations, attorneys, and others interested in the field to submit similar written statements to us. Hopefully, we will have more statements on these questions. We may have yet another day of general hearings sometime after the August recess. I am not sure that we have completely heard all useful points of view on the issues before us. In any event, with these thoughts in mind, I would like to thank our witnesses, who have appeared before us. The committee stands adjourned. [Whereupon, at 12:15 p.m., the subcommittee was adjourned.] No. 1] COPYRIGHT LAW OF 1976 165 to take into account and was not equipped to handle recent technological changes, such as computer software, reprography, and satellite broadcasting, to name just a few. In fact, the reports of both the Senate and House Judiciary Committees contain language suggesting that this new technology was a major impetus behind the Copyright Revision Act. The very first paragraph of the Senate report on the Act states that "many significant developments in technology and communications have rendered (the present Copyright Law) clearly inadequate to the needs of the country today." The House report expands this idea further: ... Motion pictures and sound recordings had just made their appearance in 1909, and radio and television were still in the early stages of their development. During the past half-century a wide range of new techniques for capturing and communicating printed matter, visual images, and recorded sounds have come into use, and the increasing use of information storage and retrieval devices, communications satellites, and laser technology promises even greater changes in the near future. The technical advances have generated new industries and new methods for the reproduction and dissemination of copyrighted works, and the business relations between authors and users have evolved new patterns." Yet, despite these justifiable and important concerns, when one actually looks at the long history of the new copyright law to see precisely how it handles them, it appears that Congress only decided to create the National Commission on New Technological Uses and Works (CONTU) in 1974. This Commission must report to the President and Congress recommendations for future changes in the Copyright Act which will keep them abreast of the developments in technology." The Commission rendered its preliminary report on October 8, 1976; it is required to submit another by December 31, 1977.18 The Commission is also authorized to submit as many interim reports as it deems necessary," although to my knowledge no such reports have been issued. BMI is the largest performing rights organization in the world, with over 30 thousand writers and 15 thousand publishers. In addition, it administers hundreds of thousands of works from abroad. It is the leader in establishing new technologies to handle |