Conclusion To sum up: records released We have looked at over 1,300 tunes licensed for regular price to the trade by 2 prominent record companies over the better part of 1974 and more than 1,200 other licensed tunes on budget albums, all as set forth in Exhibit 21. From this exhibit we see the following: More than 99% of all licensed royalty rates were at the For regular price singles, the 2¢ statutory rate is For regular price LP albums, the 24 statutory rate was For other than regular price records, including both budget rates. In short, just as we showed 10 years ago, the statutory rate of 24 and standard, generally available, non-discriminatory variations therefrom account for the overwhelming bulk of all rates paid (exclusive of public domain material). The statutory rate, flatly contrary to the arguments of the publishing companies, is not "merely a ceiling". The statutory rate and standard variations are overwhelmingyly the norm. There is not, and has not been any significant amount of "bargaining" or real negotiation about these rates. Nor would there be in the future under any higher rate. Any statutory rate would become the norm. The outcome and the effects of a higher rate can be forecast with confidence. 117 Rates other than standard or intervals or percentage thereof. Source: Two major record companies having an estimated unit sales volume in 1974 of 50 million records. 118 PREFACE This Technical Appendix explains, supports and amplifies the data contained in the "Statement on Sec. 115 of H.R. 2223 of John Desmond Glover, Director, Cambridge Research Institute" before the Subcommittee on Courts, Civil Liberties, and the Administration of Just rice of the Committee on the Judiciary, U.S. House of Representatives, September 11, 1975. The statement was based upon a study of economic effects of proposed changes in provisions of the copyright law relating to the licensing of copyrighted music for recordings. This was the second such study conducted in ten years. The material that follows is organized into two main sections. The first section supports exhibits in the Summary Statement (pages 1 to 31 herein) presented orally by Dr. Glover to the Subcommittee. References are provided to specific sections of the full statement which explain the conclusions stated in the Summary exhibits. The second section supports exhibits in the full statement, as needed. 120 B. Price Per Tune is Down; Copyright Owners' Share is Up 123 C. Mechanical Royalties Have More Than Doubled 123 D. Mechanical Royalties Outpace Inflation and Median Family Income, 123 E. Mechanical Royalties Paid Per Released Tune Outpace Inflation 123 J. In 1974 as in 1963 Tunes were Licensed at 2¢ or Standard 124 2 & 3. 4. INCOME TO COPYRIGHT OWNERS FROM RECORDINGS, 1973 vs. 1963 126 132 5. ESTIMATED FINANCIAL STATISTICS AND INCOME STATEMENT FOR THE U.S. 132 6. STATUTORY LICENSE ROYALTIES PER TOP 150 LP ALBUMS IN 1973 AT VARIOUS 158 7. FINANCIAL IMPACTS OF PROPOSED INCREASED MECHANICAL ROYALTIES ON 159 1971-1974 8. 9. MECHANICAL ROYALTIES COMPARED TO RECORDING INDUSTRY PRE-TAX 160 160 10. COST TO CONSUMERS OF A 3 STATUTORY LICENSE RATE 161 |