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Mr. DANIELSON. I think probably you have a problem which probably can be reached

through a communications policy which is administered by the Federal Communications Commission or which could be reached through legislation. But this committee uniquely is dealing with the problem of copyright. You have a competition problem. You are trying to resolve it through copyright. I think it may be the wrong vehicle. Again, I am willing to be convinced. But I am not going to take judicial notice of anything that is not shown to me.

I have one last question. What is your objection to legalized gambling?

Mr. Kuhn. I have a position that I am afraid I can only state in much too much length for the minute you have.

Legalized gambling, in a nutshell, would bring into the following of sports a great many people who do not gamble on games today.

Mr. DANIELSON. It is moral!

Mr. Kuhn. It is both moral and practical, because if you bring a lot more people into gambling on sports, what you are going to have is a great deal of suspicion cast on the honesty of sports. The more gambling you have on sports, Congressman, in my judgment, the more people you are going to have saying that every time a foul ball is dropped or a ball slips away from the catcher, that that was done dishonestly. The more suspicion you have of professional sports, then the more public harm you are going to do to those professional sports and amateur sports.

Mr. DANIELSON. Would you say that applies equally to horseracing?
Mr. Kuhn. No, I do not think so.
Mr. DANIELSON. Thank you very much.
Mr. KASTENMEIER. The gentleman from Illinois.

Mr. RAILSBACK. Commissioner, I want to welcome you, first of all, and ask you if there is any empirical data that would indicate the decline in attendance as a result of, for example, the Boston, Mass., incident to which you refer in your testimony. I think that would be very helpful to us.

Mr. Kuhn. I wish I had some I could give you.

The problem is really too new to have developed empirical data that would be convincing on the subject at this point. We are working largely with the very strong conviction of people in professional and amateur sports and in the broadcast industry. But at this point I could not actually prove it to you.

Mr. RAILSBACK. There are two areas that concern me. One is in respect to minor league franchises. When they are playing ball, what effect would cable television have on that particular attendance?

I want to say I personally can see where, if you had 11 cable systems importing the New York Mets games, that that could have an effect. I think that certainly could have an adverse effect. But how were those 11 systems licensed to do what they did with respect to the Boston station?

Mr. Kuhn. They make application to the FCC and get—it grants the license permitting the carriage of the signal of certain other stations in other cities. This is the proceeding on this.

Mr. RAILSBACK. When the FCC does that, is there any opportunity for the local station to appear and resist? Also, is there a chance for

the copyright holder to also complain or file a grievance as wellhow does that work?

Mr. Kuhn. I think the answer to that question is in the negative. These proceedings have been going on for some time now, as these new licenses have been granted. I believe that the answer to that is, no.

Mr. RAILSBACK. Were these new licenses granted beginning after the so-called Consensus Agreement! Had they been prevented up until that time?

Mr. Kuhn. I am not sure about the date of the Consensus Agreement, but they began to be granted after the breaking of the freeze on March 31, 1972.

Mr. RAILSBACK. And, up until that time, you did not have the problem, at least certainly not to the extent or magnitude that you have had since that time?

Mr. KUHN. That is correct.

Mr. RAILSBACK. That is why you do not have the empirical data. Are you planning to develop that kind of data !

Mr. Kuhn. We will develop everything we can on it. If we have empirical data, we will certainly be putting it into the hands of the people who ought to be considering this problem. I am sorry we do not have it now.

Mr. RAILSBACK. That is all, Mr. Chairman.
Thank you.
Mr. KASTENMEIER. The gentleman from New York, Mr. Badillo.

Mr. BADILLO. You do not support the bill as it stands now; is that correct?

Mr. Kuhn. That is correct.

Mr. BADILLO. You would recommend the amendments which are listed in your statement on pages 15 to 18 from first through five?

Mr. Kuun. That is correct.

Mr. BADILLO. That is what you call the baseball compromise. Who comprised on that? Why do you call it the baseball compromise ?

Mr. Kuhn. They call it a compromise in the sense perhaps the word is not a good one—when the copyright bill first started out, it provided that the sports interests would have control over the dissemination of their product by secondary transmissions.

As it wound its way through the editorial process, those original positions of control were eliminated, and were replaced with the language now appearing in here. So what I am saying is that our position, that we are really and fairly entitled to control, as we do with over-the-air television, has been compromised down to a position which we state here.

Mr. Badillo. That does not mean that the cable television people have consented ?

Mr. Kuhn. I did not mean to imply that; they certainly have not agreed to it.

Mr. BADILLO. It is not like the Consensus Agreement, which is neither a consensus nor an agreement?

Mr. Kuhn. No, sir, it is not.

Mr. BADILLO. The 75-mile zone--you say it should be a 75-mile zone in major league cities, into which cable could not import distance signals on an unconsented basis. That means you would have to consent, the baseball team, each time—is that what you mean?

Mr. Kuhn. Yes. What I am saying is that if the system in Milwaukee was to carry WGN in Chicago, a Cubs game, they would have to have the consent of the clubs, just as they do with over-the-air today.

Mr. BADILLO. That would be even if there were no game at all in the city to which it is being carried?

Mr. Kuhn. That would be up to the Cubs. The Cubs today, if they wanted to, could sell broadcasting rights in the territory of the Milwaukee clubs, and some of our major league clubs have done that.

Mr. Badillo. If the clubs do not want to give the right, so that you really are giving the clubs the exclusive control-it is really not a question of consent; you are really saying the exclusive control is for the clubs?

Mr. Kunn. I would say it is a question of consent. If I may just make this point, the word blackout has been used by our friends in the cable industry very effectively in the pejorative sense, to make it appear that what we are trying to achieve is very bad, here. This is not a blackout question, any more than our control of over-the-air television is a blackout question. If it were, then presumably you would not see all the over-the-air television that you do see, and you would not see the 200 games being televised in New York City that we have today. We have not exercised our rights of control on over-the-air in any unfair way or any way that would work against the public interest, in my judgment. Nor do I think there is any reason to think we would exercise such rights in a wrong-headed sense, with respect to public interests where they do apply to cable.

Mr. BADILLO. But you want the right-if you decide to have a total blackout, you could have it?

Mr. Kuun. Theoretically, just as in over-the-air.

Mr. DANIELSON. I have been trying to understand whether you mean the control would be in the team that does the playing or the team which is resident in a city!

Mr. BADILLO. The team that does the playing. In other words, just like the word compromise is not really compromise, an unconsented basis is another way of saying total control by the team that does the playing does not want a town, at any time, because they threw them out, let's say, to have a game broadcast, it just would not happen. There is no review at all. That is what is being proposed ?

Mr. Kuhn. That is correct. I think it is unfair to suggest that there would be an unreasonable use of that any more than there is with the television.

Mr. BADILLO. I am suggesting that the proposal you make is one for exclusive and sole control by the team which is playing.

Thank you.
Mr. KASTENMEIER. The gentleman from New York, Mr. Pattison.

Mr. PATTISON. The team that is resident in Milwaukee-does that team have something to say, under your proposal

Mr. Kuux. No; it does not.
Mr. PATTISON. As to whether another signal is imported ?
Mr. Kuun. No; it does not.

Mr. PATTISON. In other words, the effect of having 11 baseball games going on in Boston, competing with the Red Sox game being played there is not something you are addressing yourself to here?

Mr. Kuhn. No. As far as we are concerned, the matter should be left to the club which created the property rights.

Mr. PATTISON. So it would be to the interest of most clubs to have their signals imported if they were getting a copyright on it all over the country, wherever they were not playing?

Mr. Kuhn. It might or might not be. It would just depend on what they thought was their particular interest.

Mr. Pattison. Your primary interest is in protecting the area around the place where the ball game is played, so that you do not lose the home gate?

Mr. Kuhn. And the home broadcasting rights—that is our primary interest.

Mr. PATTISON. Presumably, lots of times, you would not broadcast in Washington, D.C., when you have a game on here. For that particular game, you would broadcast that outside of Washington, D.C.?

Mr. Kuhn. You mean, if I were a club in Washington?
Mr. PATTISON. Right.

Mr. Kuhn. Normally, in baseball today, you would try to broadcast your away, games on television and try not to broadcast your home games. As it is, of those we broadcast about two for every one are away, as against home.

Mr. PATTISON. The determination is made as to whether you can get a gate there?

Mr. Kuhn. Your bigger cities, like New York and Chicago, seem to think they can get a gate, even though they do telecast the home game. Therefore, a great many home games are telecast in New York and Chicago.

Mr. Pattison. It is not the normal competition of other teams playing in your home area that is bothering you? In other words, the fact that there is a lot of activity going on in Boston that takes away from people going to the Red Sox is not something that you are addressing yourself to here?

Mr. Kunn. If I understand your question; it is not. But what does worry me is this. If the Mets are having a very good year and the Red Sox are down, just taking an example, and a lot of Met's games are going to be carried by cable, the Red Sox are going to go farther down, because it is quite possible that the people will stay home and watch the Mets on cable, since this is where the action is at that particular time.

Cable will be selective about what they do carry. If the Mets are very attractive, they will bring them in. If they are not, they presumably will not, in cable's discretion, under the present arrangement. We think that could be very harmful, not only to the gate of the Red Sox, but to the broadcast rights of the Red Sox.

Mr. PATTISON. Under current law, the Boston cable, if there is something it can pick up in the air, if it has the right to import that particular signal from that particular station, which is a limited right, it could play the Mets, to the detriment of the Red Sox, just on the basis of a pure competition basis-people want to watch that rather than watch the Red Sox?

Mr. Kuhn. Yes, it could do so today, under current law.
Mr. PATTISON. Do you object to that proceeding?

Mr. Kuhn. Yes, I do. When I say it could do so today, under current law, I am talking about the current regulations of the FCC. And

indeed, under the proposed copyright law, it is permissible under both of those

Mr. RAILSBACK. Would you yield?
Mr. PATTISON. Yes.

Mr. Kuhn. I question whether it is permissible under common law if we want to press the notion of common law copyright. We have not pressed that to date because of the pending statutory administrative position.

Mr. RAILSBACK. Commissioner, I think you are probably right in the thrust of your argument, but I would think you could probably take some examples where cable systems started to import signals and as a result attendance figures actually declined. I would think you could obtain some examples. You certainly have up-to-date attendance figures.

Mr. Kuhn. With my example in Boston, what you do find is confusing. You would have to do some market surveys. When the Red Sox are in first place, that is an upward thrust on the attendance; there is a downward thrust in the attendance by reason of cable. Where the effect is, you cannot automatically measure by looking at attendance.

Mr. RAILSBACK. It would be an analysis. I wouid think that what we are talking about here is substantial economic interests. So I would think it would be very helpful to have that kind of an analysis made. I do not have any idea how expensive it would be just to obtain examples.

Mr. PATTISON. To protect baseball's interest in its own product, the Red Sox's interest in its own product. But I am not particularly interested in protecting Red Sox interests against other competing products, whether they be baseball or anything else. I think that is where we differ.

Mr. Kuhn. As far as anything else is concerned, we certainly do not differ, because we have no objection to cable carrying anything, so long as it isn't baseball. We have no prerogatives in that area. As far as we are concerned, we do not create those. So you can send—if cable wants to carry football against baseball or hockey, we have no objection to that whatsoever. We would be just as happy that it is not there, but with legitimate competition, there is nothing in the world we can say about that. It could be opera—I hope it is—but, where they carry the games of another baseball team that other baseball team does not want carried, then we think there is a real question, or without any say-so in any event, by the other baseball team. What will the Mets think about their games being carried in Boston? It seems to me the Mets ought to have control over that, because they create the property. I do not think the Red Sox should control it, because they did not create it. I think the position I am taking is a very logical one. We are only saying that whoever creates it should have the control.

Mr. PATTISON. I guess we are not only into communications policy but antitrust policy too, because it seems to me the only reason that the Mets would care or would make the decision that their games would not be played in Boston was because they would say to the Boston Red Sox, would have a conversation with them. The Red Sox would say, look, you are killing us over here; keep your stuff out of Boston, and we will keep our stuff out of New York.

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