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Second, the principle of compulsory price-fixing is unconstitutional and destroys creative work.
So far as the first preliminary objection is concerned, it is very clear that these copyright measures now before you recognize for the first time an exclusive broadcasting right.
So recognizing it, the bills confine it to musical compositions (p. 1, lines 7 to 9).
The present copyright act of 1909, so far as ordinary literary products are concerned, extends the exclusive right only to print, reprint, publish, copy, vend, translate, and to dramatize. The right of performance, exhibition, production, and other representation being confined to dramatic and musical creations. The result is that under the act of 1909 now in force, the right of radio broadcasting was not conferred upon the copyright owner, either expressly nor by implication, where the work was an ordinary literary creation (section 1 of the copyright law, subsections (a) and (b)). The bills before you fail to confer the exclusive right to broadcast in connection with all save musical compositions. These bills confer such exclusive right to broadcast solely in the case of musical compositions.
The result is that if these bills become a law, having expressly singled out musical compositions as the sole objects of exclusive broadcasting rights, the work of the ordinary literary author will be thrown into the public domain.
At the hearings yesterday an authoritative statement was made that 80 per cent of the broadcasting was of music and that 20 per cent consisted in other literary production. With the growth`in popularity of radio broadcasting, it is quite likely that the proportion of material not musical will increase, because such popularity will encourage the creation of prose material adapted for radiomonologues, very short stories, short dramatic sketches, children's stories, and essays of a popular kind. To confer by express enactment an exclusive right in favor of one class of composition is essentially a vital mistake. This will be developed further in connection with the second point, above-mentioned.
For the purpose of considering the second objection, it is wise to draw a parallel between two very popular forms of entertainment, the motion picture and the radio.
The first motion pictures presented waves dashing upon rocks or a fire engine speeding to a fire or a race horse at the track. When these pictures were exhibited, none of us foresaw the possibilities of the new industry. From those original attempts to Griffith's "Birth of a Nation" is a far cry covering a period of more than 10 years. The introduction of this new element resulted in the rise of hundreds of creative geniuses who think and write only in the terms of a dramatic picture instead of in the terms of the spoken or written word. When the motion picture photo play was promulgated the author of literary works was confining himself to magazine fiction, the writing of books, and plays. He was receiving, except in unusual cases, a moderate remuneration. The situation affecting his achievements to-day, has resulted in the living fact that his motion picture creations and his motion picture rights are usually worth more than all his other rights put together. An author who earns $2,500 from a magazine serial, $5,000 from a book,
$7,500 from a play, may sell his motion picture rights for $25,000. If he writes directly for the screen or assists in putting on a picture, giving it the benefit of his creative effort, he will receive a very large remuneration in the shape of a lump sum or salary. Outside of radio, there is no universal entertainment so widely popular as the motion picture. Its benefit to the public at large. and its tremendous popularity, is due solely to the author whether he be literary writer, scenario writer or diector. This populaity of the motion picture would never have been attained except for the fact that the author is paid what his creation is worth. Had motion pictures fixed or attempted to fix a compulsory fee of $100 or $1,000 for the material which they desired to use, the motion picture would still be in swaddling clothes.
Radio is still in its infancy. Only seven years have passed since broadcasting for entertainment was begun. Its possibilities are far greater than the possibilities of the motion picture, because it is the universal entertainment of the home. The surface has not been even scratched. Within the next 10 years a new form of literary genius will abound by hundreds, probably by thousands. Just as thousands of people now write in terms of motion pictures, so in the future will thousands of authors direct their attention to radio. But not if a fair remuneration fails to eventuate. Magazines can not exist unless they are paid fair prices; books will go out of existence unless the publisher deals fairly by the individual author; every stage will be dark unless the creator can make a living. Greater than all these forms of entertainment is the radio. It is easier to see than to read. It is far pleasanter to hear than to read. It is wonderfully convenient for a household to stay at home and to be served with high-class creations without the trouble of going to a crowded place and without the trouble of performing a musical composition upon a piano and of reading humor or drama from a book. But if the radio is to be developed for the public, its development will depend upon the creative genius and upon no one else. Fairly paid, the humorist, the essayist, the playwright, and the short-story writer will speedily adapt his genius to the limitations of the microphone. If he is the subject of a compulsory license fixing, there will be no incentive for him to go into this practically unlimited field. The laborer is worthy of his hire. It is a living fact that entertainment is one of the most important, essential commodities of the day. The owner and manufacturer of any other commodity may deal with his commodity as he chooses. The right of private property in the author must be kept as sacred as the right of private property in the ordinary citizen. Otherwise, there will be no newspapers, no books, no drama.
The universal, instantaneous nature of a radio performance bids fair at one full sweep to usurp and immediately destroy all the other rights of an author. By the present act, his works may be broadcasted without pay of any kind; certainly no broadcasting rights or rights that include them were given by an act passed in 1909 before such rights came into being. Certainly the bills before you by implication and exclusion throw into the public domain everything not a musical composition, and even as to musical compositions they throw into the public domain everything in existence
before the proposed passage of the bill. The result can best be illustrated by example: Suppose that I were the author of short, pithy, humorous skits, of use to newspapers or magazines and of use in book form. A fair sample would be the George A. fables or Mr. Dooley. Under these bills, the instant that a magazine was published containing those effusions that instant they could be broadcasted over radio. People by the tens of millions would get immediately the material which might at that instant have been read in magazine form only by thousands. Carry this to the limit of its possibilities and you will destroy all incentive to create, as well as all incentive to buy magazines and books; as well as all incentive on the part of publishers to purchase creations which at any moment may become valueless because radio has forestalled the printed page. Any legislation which grants an unusual privilege to one industry will destroy the others. From the standpoint of such industries, why is it fair to establish a compulsory license and license fee at a fixed rate in the case of radio and to establish none in the case of magazines, books, the stage, the motion picture? The profits of a large radio corporation manufacturing and controlling its own sets, the sale of which sets depends upon its radio program, far exceeds the profits of business houses engaged in the other industries named, and yet to create good will for such a firm, the result of these bills will be disaster for the other interests. All the named industries cater to the public. In order to live they must charge the public for a magazine, a book, and admission to a theater or for a radio set. The Radio Corporation does not for one instant purpose that radio sets shall be sold at cost nor that patent rights shall be the subject of a compulsory license system.
My views expressed above as to the specific failure of copyright legislation taken in conjunction with these bills, to afford exclusive broadcasting rights to the author are the views also of certain other counsel expert on this subject. It may well be that other lawyers may disagree. But the very fact of disagreement makes it necessary as I view the matter to provide in some bill that the author shall have such exclusive rights. A complete copyright revision bill recognizing such rights, being H. R. 10434, has been introduced in the House by Congressman Vestal, and hearings before his Patents Committee on that complete revision are set for April 15 and 16. Pending the passage of that bill and pending its consideration, it seems to me unwise that a proposed piece of legislation should now be entertained which casts serious doubt upon the ability of the creative genius to enjoy his own creation as contemplated by the Constitution of the United States.
STATEMENT OF PAUL N. TURNER, REPRESENTING THE ACTORS' EQUITY ASSOCIATION, NEW YORK CITY
Mr. TURNER. Mr. Chairman and gentlemen of the committee, my name is Paul N. Turner, representing the Actors' Equity Association whose membership includes about 15,000 actors, being practically all those actively practicing the profession in the United States. Our objections to the bill are both general and particular. Our general objection is to any legislation which gives to the maker of literary and musical brain products lesser rights in what
he has made than if he created a product by manual labor. We feel that both classes should be on a par, and that each maker should have the individual right to handle or dispose of his products without limitation unless his dealing with his product tends to create a monopoly.
Our particular objections are that this is neither the time nor the place for this legislation, and that this particular bill will work unfairly, not only as to actors as employees, but as to certain classes of musical authors.
This is not the time, because we all know that the radio industry is in a state of flux; and what may be the proper basis of charge to-day, may not be to-morrow. In the last analysis the proper royalty charge as to each radio station must be based upon its character and on its earning capacity-not on its wave length or the population reached. A radio station which reaches a group of farmers when farming conditions are poor, should not and can not pay as much as one which operates where business conditions are good and where advertising may yield high returns to the advertiser for which he can afford to pay.
This is not the place for this legislation. If the Authors' Society becomes a literary monopoly and the present monopoly laws are inadequate, they should be amended to cover and to govern such literary and musical monopolies. We feel it absurd that the time of Congress should be taken up in fixing prices in every special field where claim can be made that some party to a transaction may obtain an undue advantage.
Without going into details, it is perfectly apparent that this bill will operate unfairly; first, as to employees in musical plays. These productions represent a very large investment. Those now actually operating in New York City probably cost in excess of $1,000,000. It is only rarely that these productions sell out from the beginning. Audiences must be created for them. Publicity is necessary to accomplish this. An effective publicity method is to broadcast in a limited field one or two of the best songs or numbers. This attracts people in. After they start coming no further publicity is necessary. If the show is a going one, it advertises itself. After that condition is created a further repetition of songs and numbers by radio is undesirable and kills off the patronage, because these numbers become stale stuff, and people will not come to hear actors sing the same thing they have heard dozens of times on the radio.
Therefore, the provisions of this bill will foreclose the use of the radio by musical producers for advertising purposes and will result in many a good show not "getting over." This prevents and stifles employment.
Assuming that 90 per cent of musical authors are in the Authors' Society, there are still 10 per cent outside, many of them gifted men. By this bill they will be made to suffer for the alleged unfair practices of a society to which they do not belong. A successful independent song writer will, through this bill, be prevented from bargaining for the royalty value of his product.
In conclusion, this committee should not underestimate the actual cost and labor which goes into musical and dramatic productions. Musical writers can tell you better than I regarding their business,
but I know from experience the conditions in the dramatic end and can speak with knowledge of the facts.
I have a record of between 2,500 and 3,000 plays submitted during the last four years to one producing concern. I know just how many of these were produced and how many were made and lost out of them. Of all this group just one play achieved financial success, and that only to the extent of $100,000. Not more than two or three others returned to their producer any profit in excess of $10,000 over production cost. Let us assume that the total profit to the producer and those interested was $250,000.
Each of these plays was rewritten, we will say, at least twice. This makes 5,000 manuscripts to be typewritten. At $20 a manuscript this represents an outlay of $100,000. We can say that each play represented on an average six months' labor, 182 days. This represents a total of 455,000 days of labor.
In other words, looking at the situation at its best and basing our figures upon this particular situation, we find that to create $250,000 of new value over 100,000 in cash and 455,000 days of labor was expended by the author alone. And this does not touch the expenses of the producer.
Mr. BUCK. The next and last witness is Mr. Roswell B, Burchardt, president of the John Church Co., and ex-lieutenant governor of Rhode Island.
The CHAIRMAN. Mr. Burchardt.
STATEMENT OF ROSWELL B. BURCHARDT, PRESIDENT OF THE JOHN CHURCH CO.
Mr. BURCHARDT. Mr. Chairman and gentlemen, I will not take but a moment of your time; there is no necessity of taking any time here, especially for anybody who has read the record. I have been sitting here for days and days and am deeply impressed with the spirit and the manner in which this case has been presented on both sides.
In defense of this long brief, here, Mr. Chairman, I wish to say I heard it read here. I am somewhat familiar with constitutional principles and constitutional law, although not an expert, and I hope that every bit of that will be printed, and while it was being talked of being printed here, I said, "It ought not only be available for the Congressmen, who will discuss this bill possibly a year from now, but it should be separately printed and sent to every law school and every library in the country, because I think it is the best commentary, the best statement of the law of exclusive rights as applied to the copyright law, that has ever been presented by anybody, and I hope the whole thing will be printed and made permanent.
As to the point before you, it was all summarized by an old man I met in the hall just now, who was showing me the locus of this vicinity. He said, "Are you in this copyright hearing?" I said,
"Yes.' He looked at me a moment and then he said-I don't know why he did it, but he said, "I suppose you are on the side of the author?" I said, "I am." Well, he said, "That is right, you ought to be, pricé fixing is an immoral thing." I said, "Yes; it is immoral, it is illegal, and it is unjust."