mittee, you will find the statements attributed to those recording companies as to home use.

Senator MCCLELLAN. Well, all right. But the author, the composer of the song, he gets paid not just from the profit of the song

Mr. KENIN. Sale of the sheet music, you mean?

Senator MCCLELLAN. The sheet music. He makes a profit out of that. But if a broadcasting company takes a sheet of music and gets a performer to sing it, the author also gets a fee out of that.

Mr. KENIN. Yes, but, Senator

Senator MCCLELLAN. But the performer does not?

Mr. KENIN. He does not. The copyright law provides for full rights to the composer and author. He has the right to have it mechanically reproduced. He has the licensing right to have it publicly performed. He has the right to have it arranged or not arranged. And he has the right to sheet music, let's say. Well, he has four rights. These are independent of each other. He does have the rights. They are in the copyright law and have been for all these years.

Senator MCCLELLAN. But the performer who takes a sheet of music and makes a record, what does he get?

Mr. KENIN. Nothing.

Senator MCCLELLAN. He gets paid a fee at the time he does it?
Mr. KENIN. Correct.

Senator MCCLELLAN. But there is no fee or royalty that follows through when that record is played again for profit?

Mr. KENIN. That is correct.

Senator MCCLELLAN. Either in a juke box or

Mr. KENIN. Any place.

Senator MCCLELLAN. Or on a broadcast?

Mr. KENIN. That is correct.

Senator MCCLELLAN. That is what you want? You want them paid? Mr. KENIN. I want them to be included in the payments that those are getting.

Senator McCLELLAN. You do not want them to be included unless you want some money out of it. You waste your time.

Mr. KENIN. Yes, sir.

Senator MCCLELLAN. Now how do you want them to be paid? I understood you said a while ago you could not say how much you want it to be.

Mr. KENIN. I do not know how much the total would be, I do not know what is the individual

Senator MCCLELLAN. I mean a percentage royalty. You have not determined that?

Mr. KENIN. We are completely satisfied with having the Register of Copyrights, after hearing, determine that fee.

Senator MCCLELLAN. Are you submitting language you think will do that?

Mr. KENIN. Yes, we have. Our counsel have done that, sir.

Senator MCCLELLAN. Then the question is, are you entitled? That gets right back to a fundamental-the composer gets his music copyrighted. With that copyright he can prevent somebody from singing his number; if somebody makes a performance of it, he is entitled to a fee. He can prevent somebody from making a record for home use or entertainment but if it is done he is entitled to a fee.

When it is played again for entertainment purposes, what are the charges? Does not the royalty of the composer follow through on that also?

Mr. KENIN. Yes, the composer and author does get it.

Senator MCCLELLAN. But the performer, once he gets paid for singing the song and making the record, that is the end of it under the present law and you want it extended so he will get a fee and participate in the profit that is made out of the commercializing of that song? Mr. KENIN. That is correct, sir.

Senator MCCLELLAN. That is the issue, is it?

Mr. KENIN. That is correct, sir.

I might say this, that everyone seems to agree that there is a moral right in this assertion we have made and the House subcommittee's report gives flattering evidence of that theory and philosophy. The only ones who oppose it

Senator MCCLELLAN. I am not arguing against it.

Mr. KENIN. I know.

Senator MCCLELLAN. I am just trying to understand what is the fundamental issue. It will take a lot of calculation in a computer to determine how much you are entitled to and how you are going to figure it out and how you are going to collect it. But the principle involved here is, is the performer entitled to share in the profits from commercialization of the record he made?

Mr. KENIN. Yes, sir; we say yes, sir.

Senator MCCLELLAN. All right, I understand.

Senator BURDICK. Just one question apropos to this. I think we should have the record show that the performer, in addition to his flat fee, today has an arrangement for a private royalty.

Mr. KENIN. Well, yes. Of course.

Senator BURDICK. He sells so many records, and, he gets a royalty? Mr. KENIN. You have several situations that might be illuminating here. Let's take a name, some name leader who has bargaining power. When he makes his deal with the recording company, he can negotiate, in addition to the scale wages established by his union, and additional payment based on sales. That is the individual person. These are far and few between, and not for public performance. This is on the basis of sales.

Senator BURDICK. Well, let's get at this. Frank Sinatra, for example, cuts a record. He gets a flat scale for that. He also gets a royalty for the number of copies that are used?

Mr. KENIN. I am sure he does-sold, not used.

Senator BURDICK. Either one, sold or used.

Mr. KENIN. No, it is a different one.

Senator BURDICK. All right, sold.

Mr. KENIN. Only sold, not for use.

Senator BURDICK. These are sold around the country. He gets a royalty from all of those.

Mr. KENIN. I don't know what Frank Sinatra's royalty is. I am sure he has a handsome royalty for sale of his record for home use only. He doesn't get a royalty for the use of his record in any public performance for profit.

Senator MCCLELLAN. When a broadcasting station broadcasts his record for entertainment of its listeners, he gets nothing.

Mr. KENIN. That is right.

Senator MCCLELLAN. Your interpretation is he should have something.

Mr. KENIN. That is right.

Senator BURDICK. Does not the record company that cuts the record get a royalty for the amount they sell?

Mr. KENIN. Yes, but not for use.

If I may intrude on your time a little bit here, Fred Waring, years ago, as the entire American public knows, quit recording because he could not control the use of his records against himself. He had a program then for the Ford Motor Co., in which he had a live broadcast of his great ensemble. At the same hour in several cities, some little radio stations would put on the Fred Waring Hour and use his phonograph records. He stopped making records at that time. I do not know how many records Fred Waring has made since. I think very few.

Senator BURDICK. The fact is that the performer does not receive his royalty until so many copies are sold to take care of the expenses. There has to be certain amount beyond the expenses before he gets his amount?

Mr. KENIN. Oh, yes; all that has to be taken care of.

Senator BURDICK. If he has a million-record sale, then he gets a substantial amount?

Mr. KENIN. Yes, he does pretty well.

Senator BURDICK. Senator Scott?

Senator SCOTT. I think it has been pretty well covered.

Senator BURDICK. Senator Fong?

Senator FONG. Mr. Kenin, you refer to West Germany, Scandinavia, some of the other European countries which do let the performing artists participate in the royalties, is that correct?

Mr. KENIN. Yes, sir.

Senator FONG. Could you tell us how they participate?

Mr. KENIN. I will ask Mr. Adler, who is more familiar with that, Senator, to answer your question.

Mr. ADLER. Senator, if you will refer back to the minutes of the hearings before this subcommittee on March 21, the matter was completely gone into in the testimony of Mr. Diamond, who in turn was referring back to study No. 26, prepared by Assistant Register Barbara Ringer as part of the preliminary research done in connection with these bills. Now, I do not mean to avoid answering your question, but

Senator FONG. Could you give us in a few words how it is done? Mr. ADLER. The English system, for example, collects on the basis of what is called needle time, which is the actual time that the records are used by the BBC and other broadcasters in England. That money is then paid over to the phonograph record manufacturer, who in turn distributes part of it to the musicians union and to, I believe, other performers, and retains part for itself. This, I think, basically is also the West German system, too.

Senator FONG. So payment is made at the time of performance, is that correct?

Mr. ADLER. Payment is made with relation to the use, the broadcast of the record, based on the amount of time the records are broadcast. Senator FONG. And who keeps the record?

Mr. ADLER. The record is an ordinary phonograph record which is sold or given away in the ordinary channels

Senator FONG. I mean who keeps the time?

Mr. ADLER. The broadcaster himself, the same as in our country, broadcasters log time so the time for use of records in England is logged by the broadcaster himself.

Senator FONG. Now, I think we recognize that there is a proprietary interest in this by the performers. The question is how do you do it? Now, you recognize that your right is subservient to that of the composer, is that correct?

Mr. KENIN. Well, we do; we have stated

Senator FONG. I think in your statement you have so stated.
Mr. KENIN. Yes.

Senator FONG. Now, we have given to the composer, I think, 2 cents per record. What percentage of that do you think should belong to the recording artist?

Mr. ADLER. Senator Fong, I do not believe that any part of that percentage belongs to the performing artist, because that payment is made not for the performance of the record but for the right of the record manufacturer to use the copyrighted music, to actually take the music and put it on his record and to then sell that record for home use. That 2.5 percent in no way relates to the broadcast of that record by a broadcaster who buys it either at a store or who, more ordinarily, gets it free for the purpose of public performance.

Senator FONG. Suppose we concede that. Now, we get into a dilemma as to how we are going to compensate the recording artist and we get into the same dilemma when we come to the jukebox question as to how we are going to collect. Suppose this committee were to say that we catch it at the outset, at the time of manufacture. What kind of a royalty do you think the performer should get?

Mr. ADLER. Senator, if you will forgive me, I do not believe this is an area which is susceptible of collection at the source, because that would merely perpetuate the evil that exists today. It is not the fault of the record company that the record is publicly broadcast for profit. It has no control over that.

Senator FONG. If you were to consider catching it at the source, actually, you already have that, is that correct, by the fee that is charged?

Mr. ADLER. Actually, it is collected at the source by the music publisher whose musical composition is recorded, is electronically, physically placed on a disk. That is what the 2.5 cents is paid for.

Senator FONG. If the artist, the performer, gets paid at the source, he has already been paid by the fee that he asks.

Mr. ADLER. He has been paid for the services he rendered by coming into that studio and performing for that record for the purpose of that record being sold in ordinary channels, principally for home use.

Senator FONG. And a good artist, he has the power to make that agreement?

Mr. ADLER. Yes, he has. On the other hand, most artists do not. And what we call the sidemen, the musicians who play in support of him, have no such power.

Senator FONG. So the objectives, as far as your group is concerned, is to really put a percentage or a cent charge at the manufacturer?

79-397-67-pt. 3- -10

Mr. ADLER. Senator, I do not believe it is at all susceptible to collection at the source from the manufacturer. Today under the existing law ASCAP collects for the public performance of musical compositions embodied in phonograph records in radio broadcasts, and at the same time, another music publisher is collecting at the source for the manufacturer's act of putting that music on the record—there are two rights: the right to record and the right to perform.

Senator FONG. Now, what we are trying to get down to is how payment is to be made for the right to perform; whether we should pay at the outset or pay when you perform it. Now, the difficulty is actually in trying to compute the time of performance. This is the difficulty we find also in the jukebox.

Mr. ADLER. And our presentation certainly faces up to and recognizes not only the difficulty but the novelty of the question. That is why we threw out the idea. Perhaps there are better ideas, that it be treated as a public utilities commission set power rates after testimony, after hearings, after use, after carving out a proper area of free and fair use and with due regard to the public interest; let some independent agency set that fee in view of everybody's interest and in view of all of the equities.

Senator FONG. Mr. Kenin has said he would rather leave it to the Register of Copyrights?

Mr. ADLER. That is right.

Mr. KENIN. It is entirely satisfactory.

Mr. ADLER. The other suggestion is that it be done by compulsory arbitration-one or the other.

Senator BURDICK. Thank you very much.

Mr. KENIN. Thank you very much.

Senator BURDICK. The next witness before the committee will be Mitch Miller.

STATEMENT OF MITCH MILLER, ON BEHALF OF THE NATIONAL COMMITTEE FOR THE RECORDING ARTS; ACCOMPANIED BY MICHAEL V. DiSALLE, AND SHELDON I. COHEN, COUNSEL

Mr. DISALLE. Mr. Chairman, Senator Burdick, Senator Scott, Senator Fong. My name is Michael V. DiSalle. I am not a musician, although I have been known to sing at times when elections have turned out different than I thought they should. This morning, I am here in my capacity as a member of the firm of Chapman, DiSalle & Friedman, serving as general counsel for the National Committee for the Recording Arts.

In spite of some statements that have been made, the National Committee for the Recording Arts is not an extensive lobby. It has been organized less than 2 months. After the House committee concluded its hearings on the copyright bill and the performers discovered that this long-standing inequity still existed, they decided that they ought to try to do something about being included in the bill. The performers were generally familiar with the copyright law, but possibly, they might have been naive in not understanding that unless their cause was prosecuted, unless they appeared, they might be left out of consideration. This they have been trying to remedy during the last few weeks.