RIAA strongly concurs, is that "[t]he proposed Mathias Amendment No. 1333 and Edwards Bill H.R. 5705 would accomplish exactly such a salutary objective." at 31.) (Id. IV. BASIC CONSTITUTIONAL PRINCIPLES MANDATE The purpose of the home taping legislation introduced by Senator Mathias and Representative Don Edwards is not merely to compensate copyright owners for the economic losses attributable to home audio taping, nor merely to provide an enforceable remedy for the infringement of existing legal rights, important though these purposes are. It also implements certain basic constitutional principles and property rights. The first basic principle served by this legislation is found in the Copyright Clause of the U.S. Constitution. That clause authorizes Congress to establish a copyright system that will reward creators for the use of their works and thereby stimulate the creation of new works for the public benefit. Uncompensated home taping offends that constitutional principle because it denies creators a just reward for the use of their works. And by denying creative artists their just compensation, home taping frustrates the copyright system and thereby works to diminish the quantity and diversity of new creations that can be offered to the public. The second basic principle served by this legislation is the right to compensation for the taking of private property. Home taping involves the invasion of legally protected property the exclusive right - owners of copyrights in sound recordings and musical works. Without any compensation, home taping is nothing more than a "home taking" of private property. detail. We next discuss each of these points in more A. The Constitutional Basis of In considering the issue of home taping, it is important to bear in mind that our American copyright system is based not merely upon statutory enactment but upon the United States Constitution itself. Article One, Section Eight of the Constitution authorizes the Congress: "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." 38 The Supreme Court has explained the philosophy underlying the exercise of that power as follows: "The economic philosophy behind the talents of authors. In other words, the purpose of affording copyright protection is both to reward the creator and to encourage the production of literary and artistic works for the public benefit. As the Supreme Court has put it: "The immediate effect of our copyright But an 'author's' creative labor. The musical arts in our country have flourished under this system, and as a result, the consumer has enjoyed 27/ Mazer v. Stein, 347 U.S. 201, 219 (1954). 28/ Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156 (1975). 96-601 0-82--48 39 an unparallelled diversity of musical offerings, from classical and jazz to rock and country, from ethnic and gospel to soul and reggae. Pursuant to the Copyright Clause of the Constitution, the Congress has given copyright owners of musical compositions and sound recordings the exclusive right to control, and obtain royalty payments for the use of, their creative works. Among these exclusive rights is the right to control the reproduction of their copyrighted musical works and sound recordings.29/ As discussed more fully in Section III, above, uncompensated home taping infringes those rights. In understanding just why the copyright system is so essential to the recording industry, it is important to remember that the recording business is exceedingly risky. More than 80 percent of all records released fail even to recover their costs. On average, a company must sell almost 150,000 copies of a popular LP just to break even. It is the copyright system that makes it possible for record companies and other creators to bear these enormous risks and bring to the market an extraordinary variety and quality of musical offerings each year. Under that system, record companies are able to rely on the revenues derived from their ownership of the copyright in the occasional hit to subsidize the more than 80 percent that are losers, the recording of new unknown artists, and the release of special music (such as classical, jazz, ethnic, and gospel). In this way the copyright system not only enables the industry to survive, but also encourages experimentation and the promotion of unknown talents. It thereby ensures the availability of a broad variety of music. Certainly, at a time when we are witnessing a decrease in public funding for the arts, the copyright system plays an even more vital role in fostering the production of new creative works. If the arts are to be self-sufficient, then Congress must ensure that the marketplace operates fairly and that copyright owners can obtain fair compensation notwithstanding technological developments. Unless the home taping issue is resolved in such a way as to guarantee fair compensation to those whose intellectual property is now being appropriated in massive amounts, the recording industry will be unable |