Mr. BLISS. As you can see, Congressmen, the CRT penalty fee pulled the WGN plug on 1,772,000 people in the 12 States you rep resent. I spoke with Eastern Microwave on the telephone yesterday, they are the common carrier for superstation WOR. They claim that they lost 4,800,000 viewers in 150 cable systems scattered throughout the continental United States. I could talk for an hour, and possibly even a week, about why cable shouldn't pay any copyright fees, but that is really not why I am here. I am here to discuss equality of service between the big cities and the small cities. The only thing I will say about copyright is please don't lose sight of its purpose. As stated recently by David Lange before this subcommittee, the ultimate purpose of copyright is not to protect authors or to make them rich, but rather to enrich the public domain. Compulsory license was initiated to prevent the withholding of product from the public domain. In 1976, the cable industry gave up on the copyright issue in exchange for a relaxation of many of the FCC rules and, in an attempt to get the copyright owners lobby off their back, cable agreed to a negotiated copyright fee structure. Everyone involved, as we have discussed this morning, knew that it was negotiated fee structure. The copyright owners knew, Congress knew it, and the cable industry certainly knew it. There was, however, a gaping hole in the 1976 law. I believe this is really the answer to Congressman Mazzoli's question. This loophole allowed the newly-formed CRT to use their discretion to change the copyright ground rules when the FCC dropped their distant signal limitation rules. So, what happened? In 1980, the FCC dropped their distant signal rules and, while the cable industry and its leaders were off chasing other dragons, the MPAA convinced the CRT that everyone in the Motion Picture Association was a starving artist. The CRT bought the MPAA's starving artist theory hook, line and sinker, and socked it to the cable industry, even though the gross revenues of the nine principal MPAA supporters is over a billion a year. As Tom just said, in public statements, the CRT repeatedly said that these new rates more clearly represent the marketplace. The rates were never supposed to be marketplace. Remember, cable would have never agreed to pay copyright fees if they were to have been marketplace. They were negotiated rates. They were a political solution, a compromise, between no liability and marketplace. The cable industry only agreed to pay copyright fees to get the MPAA off their backs. The cable industry had two Supreme Court rulings indicating they did not have to pay copyright fees. We now have copyright fees, and we are feeling the effects of this legislation. We are now asking for a reasonable interpretation of the legislation which went into the copyright law. We are realists, and we don't believe that an all-encompassing revision to the 1976 act could get passed by Congress in a reasonable timeframe, if ever. We think we have a reasonably good chance at fixing one gross inconsistency in the existing law. That inconsistency is that cable systems in different markets are treated unequally. Cable systems in the top 50 markets, the 50 biggest cities, can carry 3 distant signals before they have to begin paying the penalty fee. Cable systems in the second 50 markets can only carry 2 distant signals before having to pay the penalty fee. This a list of all the cable communities only allowed two distant signals. This is in the record. [The list to be furnished follows:] Cable Communities Only Allowed to Import Two Distant Signals |