involves no more than adding an additional amount to the usual rental charge. "On-premises" owners would merely remit directly to the U. S. Treasury. Now, if the collection problem is "susceptible of analysis and the drawing of reasonable conclusions", so is the determination of actually how many pages of the 14-million currently photocopied were from copyrighted sources. First, we propose that publicly-supported, "not-for-profit”, libraries be required, in this public interest, to keep track of the number of pages photocopied from each work bearing a copyright notice in their collections, and report this information periodically to whatever copyright-royalty clearing house facility is established to handle the situation. (This does not apply to coin-operated copying machines furnished by commercial operators where the librarian has no control over the operation by patrons of the library-these are subject to the excise tax on their metered-output, but no reports are required). We would like to emphasize that the librarians' responsibility for copying machine usage does not require any more bookkeeping than logging and accumulating the amount of pages copied by users of the copying machines under the library's control, and identifying the source-items bearing a copyright notice and the quantities copies therefrom. It is reportable if it bears a copyright notice (from 1910 on)-as pointed out later, royalty distribution will be made only (by the Clearing House) if the copyright is valid and the owner requests participation. We would also like to re-emphasize that this is no more than a straight, simple record-keeping operation, much of the labor of which can be handed over to the patron desiring photocopies. What would this information, reported by all publicly-supported libraries yield? A national picture of hom many times each copyrighted work was copied― a national sum of just how much copying of copyrighted works is done by patrons of "not-for-profit" libraries-a national sample of the relative copying-popularity of copyrighted works that can be a reasonable basis for extrapolating the total copying of each copyrighted work. Again, common-sense and reasonable accommodation must play a role. (1) what percentage of the total of last year's 14-billion photocopies were processed by "not-for-profit" libraries serving all types of patrons in government, in all types of business, commerce industry, and in science, technology and education, and (2) the frequency to which each copyrighted book and journal was copied, we at least have the beginnings of a basis for distributing royalties to the copied copyright owners. In short, we now know that (for purposes of illustration) say, 500-million out of the 14-billion photocopies made can be accounted for by "notfor-profit" libraries. What more is copied of copyrighted works by those other than publiclysupported libraries? Plenty, we believe. We are now close to both the heart of the problem, and the means of solution And, we are coming close to determining how much copying royalty should be distributed to the copyright owner. Just how much is left of the 14-billion photocopies that will determine what final percentage of it is of copyrighted works, irrespective of an identification of which works were photocopied? Therefore, our second proposal is to have an appropriate governmental agency determine (1) how many pages are photocopied and what is the percentage of copying machine output by the government itself of copyrighted works, and (2) what is the copying machine output and what is the percentage of total output,-off-premises of their libraries, but on-premises of academic, “not-forprofit" institutions of copyrighted works? If administrators of the former do not know, perhaps the taxpayers ought to. Administrators of the latter certainly ought to be in a position to know how many copying machines are owned and/or leased "on campus" and in the schools and what their total annual output is of copyrighted works versus administrative forms, theses and the like. Rough-heft and ball-park estimates will do. Summing up so far, we now have the total quantities of photocopies of copyrighted material made by publicly-attended libraries of all types, governmental institutions, and educational institutions. For purposes of illustration only it might break down like this: What about photocopying by business and industry, and by commercial photocopying services? Here, all we need are total quantities. Since the machines are taxed on an entire output basis, there would be no advantage in reporting anything but a reasonable, accurate estimate, perhaps once a year, to the copying machine manufacturer. Thus, a company liable for the excise tax on, say 1,000,000 photocopies a year, could report that approximately 10%, or whatever, was from material bearing a copyright notice. Again, ball-park estimates will do. Let us assume that business and industry account for 250,000,000 photocopies of copyrighted material. We now have a grand total of 3-billion copies as a base for redistributing copyright royalties. Now, only libraries have to identify what copyright sources were actually copied from. Can we assume that a frequency distribution of copying based on library experience only can be applied to all copying of copyrighted works? We think so. Libraries serve all segments of the American public-all types of students, scholars, and businesses. There is a big enough mix of needs mirrored in library photocopying traffic to justify it as a giant and valid sample for determining copying royal distribution. Thus, if library photocopying were 500-million of the 3-billion, it would be a fair assumption that any royalty page rate established for a copyrighted work should be multiplied by a factor of 6 to reflect the total effect of all copying on that work. Here's how it might work with a typical scientific journal. Most of ours average 2¢-a-page as a pro-rata of their subscription price. If library experience indicated that all libraries made 50,000 copies of pages from a particular journal, then the royalty distribution would be $6,000 ($.02 x 50,000 x 6). If this particular journal had a subscription rate of $30/year, the $6,000 copying royalty payment would reimburse the scientific society and its publisher for the loss of income from only 200 potential subscribers lost to "convenience copying." Mr. Chairman, all of what we have said is only a start toward a solution. We strongly believe that reasonable people could constructively work out better principles of analysis, clearer details of execution, more realistic “balancing of equities" than we have sketched above. And, quite obviously, there are plenty of "ifs, ands and buts" which would have to be hashed out. For instance, the above, we believe, would be entirely acceptable to us as a publisher of scientific journals— we would definitely participate. But, as also a publisher of textbooks more and more subject to anthologizing, we probably would elect not to participate in royalty distribution for those particular copyrighted works. This is basically a "no-tickee, no-washee" system for authors and publishers. If they elect to participate in copying-royalty distributions for any particular copyrighted work, they waive the right to require advance permissions for non-commercial copying. Quite obviously, as this system develops, copyrighted works will. in the future, have to bear both permissive and limitative conditions as a guide to the copiers. And the transition into this "way of life" will involve many headaches which reasonable people will have to live with. Thanks to computer and systems technologies, the copying-royalty clearing house facility need not be much more than a modern, sophisticated accounting operation. It will have core storage of all active copyright owners; their nemes and addresses, their royalty rate per page (based on pro-rata of list price); whether or not they are participating in copying-royalty distributions. It will receive as "input" the reports from the libraries showing how much each copyrighted work was copied. It will pay out, say once a year, earned royalties above a reasonable minimum level. We believe the copying-royalty clearing house should be under the jurisdiction of the Congress, and under the supervision of the Library of Congress. Mr. Chairman, we do not have the competence to draft the specific legislative language that would carry out the objective of our recommendation that a nomi nal tax finance selected information-dissemination activities of the government, establish a copying-royalty clearing house facility, and fund copying-royalty payments. We do feel, however, that S. 597 should give some broad, statutory recognition of the concept. And, since "the way to begin is to begin," there is no reason a reasonable time-table could not be set up along the lines of the following: (1) develop and enact the necessary tax legislation, to be effective January 1, 1968; (2) authorize the Library of Congress to establish a Copying-Royalty Clearance Facility to be operational for the distribution of royalties by January 1, 1969. We fully appreciate the complexities involved, but we are completely convinced that the effect of the copying machine on independent publishing must be faced up to now. In summary, if all of us can only work out together a reasonable accommodation to the photocopying problem in the context of the basic principles of copyright, living with the computer age will come a lot easier. What a wonderful and challenging opportunity! We appreciate the opportunity to appear before you, and will welcome any questions. Senator BURDICK. Thank you for your very challenging testimony. Mr. LODWICK. Thank you, sir. Senator BURDICK. Does that complete the presentation? Mr. LODWICK. Yes, sir; unless you have some questions. Senator BURDICK. I do not have any. The next witness will be Mr. Aleinikoff, Mr. Cohen, Mr. Taverner, and Mr. Quayle. STATEMENT OF EUGENE N. ALEINIKOFF, GENERAL COUNSEL, NATIONAL EDUCATIONAL TELEVISION Mr. ALEINIKOFF. Mr. Chairman, we are very happy to have the opportunity to appear once more. Our testimony was interrupted, as you will recall, last month, and we are back again to discuss educational television and copyright revision. Senator BURDICK. I hope it won't be interrupted any more this afternoon. Mr. ALEINIKOFF. Mr. Robert Hudson was with us last time; he is senior vice president of NET. He completed his testimony, so he is not back with us again. We now have Mr. Taverner, who was ill the last time, and can be with us today. Mr Taverner is chairman of the board of the Eastern Educational Network and with him is Mr. Don Quayle, who is executive director of the Eastern Educational Network. On my right is Mr. Edwin Cohen, who is executive director of the National Center for School and College Television, which is the national exchange organization for instructional television. I think that, perhaps, it is almost better that we were interrupted last time, and that we are back now. You will recall at that time we expressed some deep concerns about S. 597 and what kind of effect it would have on educational television programing and broadcasting. I am very happy to report today that obviously some of the Members of the House of Representatives had equal concerns, because when H.R. 2512, which was very much in the same form as S. 597, was adopted yesterday, it was adopted with at least two amendments which went to the heart of instructional television exemption. The first such amendment, in effect, erased the 100-mile limitation that had appeared in section 110(2) and restricted exempt instructional broadcasting to an area of a radius of 100 miles. In the House version, that limitation has been completely withdrawn. Indeed, there were some comments that the exemption should be national at the very least. The second restriction Senator BURDICK. The 100 miles were eliminated? Mr. ALEINIKOFF. It was completely eliminated, sir. Mr. ALEINIKOFF. No restriction on the transmission area in the House bill. Senator BURDICK. As the bill emerged. Mr. ALEINIKOFF. The bill has been passed, and I have the figures; as I recall, it passed 379 to 29. Senator BURDICK. There is no limitation at all in the House bill that passed? Mr. ALEINIKOFF. That is correct, sir. The second restriction that was lifted was the restriction in section 112(b) which restricted the number of copies that could be made of an instructional program, and also restricted the programs to a life of 1 year. Those restrictions also were completely withdrawn, so at this point in the House version not only is there no distance limitation, but there is absolutely no restriction on the number of copies or the length of time copies can be broadcast and rebroadcast, as long as the programs qualify as instructional television programs. Senator BURDICK. You are either on educational televisions or within school uses, too. Mr. ALEINIKOFF. It is only school uses, sir. But it is not restricted to instructional broadcasts which are broadcast into schools. It also includes college credit courses for home audiences, instructional programs for home audiences that are disabled or otherwise unable to get to classrooms and similar gathering places, and similar teaching and training broadcasts. It is restricted to those kinds of programs which are part of the systematic instructional activities of an educational institutional organization. So it is in the main limited to instructional television. As you know, when we discussed this matter the last time we were here, these were the principal restrictions about which we had such deep concerns for instructional television. And so, we left with your staff some suggestions for possible amendments to exempt exactly these kinds of broadcasts, and almost in exactly the same way as they were included in the House action. We come now and reappear before you not only hopeful that similar actions will be taken by your committee and by the Senate, but also to discuss some of the problems we have in educational or public television which are not covered by this exemption. As I mentioned rather quickly last time, these fall into two categories: One is the fair use exemption which is contained in section 107. As we read it in the act itself, we have no quarrel with the wording. We are concerned, however, with the same kind of restrictions in the House report accompanying the bill which have been lifted in the instructional television case-namely, the size of the audience, the number of recordings, and details of that kind. The second question we have is the question of availability of and access to copyrighted material. As I think we have indicated before. we are vitally interested in a clearance process so that we can have access to the materials we need with or without the payment of royalties. We were very happy along these lines to hear Mr. Finkelstein and Mr. Kaye for ASCAP and BMI, respectively, offer a license to NET, for one, that would in effect combine all the recording, performance, and other music rights that would be necessary for a single lump sum annual fee that seems to us to be a fairly workable kind of arangement. We were also happy to hear from Mr. Deighton that the publishers, too, are attempting to set up some kind of clearance mechanism. We are not quite sure what they are talking about; and we think Mr. Deighton mentioned how slow and how difficult it was to do, but we are hopeful something will happen there as well. And when Mr. Diamond talked about performance rights for phonograph records, he also indicated there might have to be some kind of a clearance organization set up for phonograph records. We wonder a little about how much of this talk of clearance mechanisms is the result of these hearings. In any case, we are happy to see them, and we hope that we can, with our statutory recommendation, obtain a system that would make exactly these kinds of clearances possible, and that is why we have asked to have some type of compulsory licensing established in the statute for educational television. Now, if I may, I would like to introduce Mr. Cohen, who will speak for the National Center for School and College Television. Senator BURDICK. The more of these problems you can resolve, the more divergent views you can resolve, as we used to say on the courthouse steps, the better we like it. Mr. ALEINIKOFF. Well, we are trying very hard, and we do think that what the House did yesterday is going to make a great deal of our problem a lot easier, and we are looking forward to settling all of these in or out of the courthouse. Mr. Cohen. STATEMENT OF EDWIN G. COHEN, EXECUTIVE DIRECTOR, NATIONAL CENTER FOR SCHOOL AND COLLEGE TELEVISION Mr. COHEN. Mr. Chairman, I am Edwin Cohen, executive director of the National Center for School and College Television, in Bloomington, Ind. I am delighted to be here before you today. With your permission, I hope that my statement may be entered into the record without my reading it in its entirety. Senator BURDICK. Without objection, so ordered. Mr. COHEN. I request further, however, your permission to skim it. Senator BURDICK. You certainly may. Mr. COHEN. Thank you very much. The reason I am here is to do three things. I would like to briefly describe what instructional or school and college television is, to indicate the function of copyrighted materials within television lessons, and to outline our specific concerns in instructional television as it relates to the Senate bill. Television is used in education as an integral part of the instructional activity of schools. State and local educational authorities deter |