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. KUHN. 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 would 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.

Mr. KUHN. Let me address myself to that very important question, because I think it is very apt to crop up in people's minds that there is something sinister or evil about what I am saying. I suggest that there is nothing of the kind. If the Mets authorize their games to be carried in Boston over a period of time, you can be sure that Boston will turn around and try to sell its games into New York to compensate for the harm that has been done to it. The Mets, if they are smart, for the first reason I am going to give you, will not do that, because that kind of retaliation is not going to do them any good. They are trading off rights here for rights there. In other words, the Red Sox will come in and hurt them, and they will go in and hurt the Red Sox, and so in their own very selfish self-interests, the chances are very good that the Mets will not sell those games in Boston.

No. 2, the strength of any league sport is the fact that you try to have viable members. If what you do with your strong club is set about to impinge upon the operations of the weaker clubs, so that they destroy the revenues of the weaker clubs, you are going to have bankruptcy in the weaker clubs. That never serves the purpose of the stronger club. Antitrust purists may worry about this, but as a practical matter within a sports league, you have got a very different concept than you do within the brewing industry or steel industry, or something like that. United States Steel does not give a dead rat what happens to Jones, but the New York Mets care vitally what happens to another baseball club. They do not want to put it out of business. It ruins the league. There is no league when you do that.

Mr. KASTENMEIER. To follow up on that-I would have thought from the thrust of your statement, that the only reason for control over those long-distance signals would be to prevent them in fact from penetrating the markets of weak teams, and thereby, what seems to have been complained about-other than the lack of control, in your statement. You indicate, however, that that would not necessarily be the case. They would be under the control of the home team.

In the case of the National Football League, for network purposes, TV pooling among the teams-which, if you have that in organized baseball, would mitigate that sort of damage, if in fact they share in both cable and regular television. Or indeed, I suppose you could have league rules concerning the importation of distant signals on cable, but you contemplate neither of these?

Mr. KUHN. Of course, we do have a pooling of broadcasting rights, under the National Television Activities 1961 Sports Broadcast Act. Those are pooled and shared equally. In the case of some of our weaker cities, that is more important revenue to them than the local revenue in fact is.

As far as cable is concerned, we certainly have not projected any arrangement for what might be done with revenues there, because our argument here is that there should be a different approach from that contemplated by the bill. I really have not contemplated that. I am not certain what kind of antitrust problems we might run into there, Mr. Chairman, if we got into pooling those revenues without the benefit of a sports broadcast act.

Mr. DANIELSON. May I have another question, Mr. Chairman?
Mr. KASTEN MEIER. Yes.

Mr. DANIELSON. I too was confused-misunderstood, in I think the same manner as Mr. Badillo, Mr. Pattison, and the chairman. I under

stood from your first point of your suggested amendments on pages 15 and 16, that you meant that the team which was resident in the proposed viewing area would be the consenting party to the television. Am I wrong in that?

Mr. KUHN. Yes. As I read the language, it is ambiguous, so I am not surprised you misunderstood it.

Mr. DANIELSON. What I am basing it on is that your sentence on the top of page 16, this area that is talking about the 75-mile zone around the city, this area surrounding major league cities is important to professional sports. A 75-mile zone defines at the very minimum, the drawing area for home games. It goes down a little farther-it is selfevident that no competing telecaster in the market has a compulsory license to bring in competing games. They should not have that power. From that I infer you are concerned about protecting the 75-mile zone around the major league city where the signal is being imported.

Mr. KUHN. I am concerned about protecting Boston, if the Mets' signal is being brought into Boston. But the control over that should be the control of the Mets, in my judgment, who have created the baseball event.

Mr. DANIELSON. I heard what you said. I understood all of the words, but the impression that is left seems to be unchanged.

Thank you very much.

Mr. KASTENMEIER. Thank you, Commissioner Kuhn.

Mr. KUHN. Thank you very much. I hope I have not confused you, and I hope I have added a little more light than darkness to this. Thank you very much.

Mr. KASTEN MEIER. Next, representing the National Hockey League, we are pleased to greet Mr. Philip Hochberg, who will present the statement on behalf of Don V. Ruck, who is vice president of the National Hockey League.

TESTIMONY OF PHILIP R. HOCHBERG, ON BEHALF OF DON V. RUCK, VICE PRESIDENT, NATIONAL HOCKEY LEAGUE

Mr. HOCHBERG. I apologize for Mr. Ruck's absence. He was tied up in New York today at some important meetings. I hope my contribution will not be brevity alone.

I think hockey, Mr. Chairman and members of the committee, subscribes to the views expressed by Commissioner Kuhn. Indeed, what has been and probably will be referred to as the baseball compromise, I am pleased to say originated in a letter from the National Hockey League to Senator Hugh Scott last August, so obviously we also concur in that.

I would like to, with the Chair's permission, address myself to the end of the prepared remarks to some of the questions specifically raised by Mr. Danielson and Mr. Railsback, Mr. Pattison, and by you, Mr. Chairman.

Mr. KASTENMEIER. Mr. Hochberg, because there is a vote which the committee must attend ongoing in the House at this moment, before you really get started I am disposed to recess the hearing until 4:10. [A brief recess was taken.]

Mr. KASTENMEIER. The subcommittee will come to order for the purpose of continuing the hearing, beginning with Mr. Philip Hochberg.

Mr. HOCHBERG. Thank you again, Mr. Chairman. I have attempted in the interest of time to cut out some of the material from my prepared statement. I might add, though, parenthetically, for 6 years I did the public address announcing at D.C. stadium for our old baseball team. It looks like we just had a rain delay in the ninth with the Senators losing. We have lost a good deal of the crowd.

Mr. Chairman, the National Hockey League urges the subcommittee to stop for a moment in its consideration of a highly technical and detailed piece of legislation, to consider the unusual problem of professional sports. The legislation before you places us in a position of competing with ourselves, wherein an entity-cable television-never having bargained with property right holders in the marketplace, can go out, "cherrypick" sporting events to best suit its own needs, and then bring in those events without regard to the consequences of that action. This potentially threatens the very foundation of professional sports.

Professional sports is unlike any other entertainment medium. What Judge Grim said in the famous 1953 decision, in United States v. National Football League, about football, is still true of all of professional sports. He said:

Professional teams in a league, however, must not compete too well with each other in a business way. On the playing field, of course, they must compete as hard as they can all the time. But it is not necessary and indeed it is unwise for all the teams to compete as hard as they can against each other in a business way. If all the teams should compete as hard as they can in a business way, the stronger teams would be likely to drive the weaker teams into financial failure. If this should happen, not only would the weaker teams fail, but eventually the whole league, both the weaker and the stronger teams, would fail, because without a league no team can operate profitably.

And if you are talking about the viability of teams in a league, you are talking, bottom line, about two sources of income: the home gate and the value of the television package both local and network sales. The impact of what you are considering today threatens the continued viability of both of these sources.

We would suggest to you that protection of the creators of these products indeed must be fashioned differently than the protection for the creators of most entertainment. Control, not payment, is the crucial aspect for professional sports. Contrast for a moment the two following situations dealing with a hypothetical Washington, D.C., cable television system which imports the distant signal of a Philadelphia television station: This station carries, among other programing, the syndicated series of "Bonanza" and the television package of the Philadelphia Flyers hockey team. There is no doubt that the importation. of the "Bonanza" series into Washington will undermine the potential sale of that program to a Washington television station. Therefore, under this proposed legislation and under the regulations of the Federal Communications Commission, the property right holder in "Bonanza" will either receive ultimately some dollar compensation or his potential sale in Washington will be protected.

The Philadelphia Flyers, however, have chosen not to attempt to sell their games in Washington. There is the implicit recognition that there may not be enough of a television market for it, but above and beyond that, the viability of the Washington Capitals hockey team will be affected if a Flyer television sale is made here.