The great majority of all records made are unprofitable. In an industry-wide study it was found that only 40 percent of all popular long-playing albums, only 27 percent of all single popular records, and only 13 percent of all classical records sold enough copies to make a profit." For the performer, as well as the record company, these records must carry the production costs of all other unprofitable releases. However, the profitable records are not evenly distributed among all performers, but tend to be concentrated in a few "stars."" The vast majority of performers are never able to recoup recording costs. In a survey of 1449 recording artists under contract last year to a variety of record companies, only 13.8% received sufficient royalties to offset recording costs. The remaining 86.2% were paid only the minimum union scale. Yet, these performers heard their recorded performances broadcast by others for profit thousands of times without receiving any compensation whatsoever. A large portion of the entertinment industry exists primarily, if not solely, by the use of recorded music, yet these users pay nothing to the performers for the use of their intellectual creations. A study of radio industry profits submitted to the Senate Subcommittee on Patents, Trademarks and Copyrights on March 21, 1967 showed that approximately 73% of all radio air-time consists of recorded music producing about 81% of radio revenue. 28 Radio revenues for 1965, the last year for which data is available, amounted to $792 million, an increase of 8.3% over 1964 with pre-tax profits of $77.8 million, an increase of 9.9% over the prior year." For the use of that recorded music, radio stations paid approximately $20 million in royalties which was 2.8 percent of total broadcast expenses. All of these royalties were paid to composers and publishers. None were paid to performers. 30 The performers' income from radio's use of recorded music is negligible. In 1963, radio stations appropriated $2.5 million for record purchases." Assuming that expenditures increased at the same rate as total radio expenses between 1963, and 1965, it is estimated that radio expenditures for records in 1965 were $2.8 million, or four-tenths of 1 percent of total expenses. Of this amount, it is estimated that all performers received only $247 thousand in royalties on the record sales. The composers and publishers in addition to their performance royalties also received about $252 thousand in royalties on record sales to radio stations. 32 The jukebox industry, which owes its entire existence to the use of recorded music, presently pays nothing to either the composer or the recording artist for the performance of their work. Jukeboxes, now gross over one-half billion dollars a year. Of this amount the total royalties paid to performers on record sales to jukeboxes is about $1.58 million or three-tenths of 1 percent of jukebox revenues. Clearly an inequity exists. CONCLUSION The National Committee for the Recording Arts believes that the present Copyright law unjustly discriminates against the recording artist by permitting others to appropriate his intellectual creations for their own profit. Under the proposed revision of the law every art form capable of performance, except sound recordings, will be protected from performance by others without the consent of the creator. The record performers and producers would stand alone in being denied the right to compensation for the use of their creations. 20 Hearings before Subcommittee No. 3 of the House Judiciary Committee on Copyright Law Revision, 89th Cong., 1st Sess., 797-99 (1965). 27 See, Library of Cong., Legislative Rec. Serv., The Phonograph Record Industry; An Economic Study, at 87-88 (1965) (Hereafter, Library of Cong. Study). 28 According to the Library of Cong. Study in 1963, 80% of radio air-time was devoted to record programming, p. 99. FCC Public Notice Oct. 18, 1966, AM-FM Broadcast Revenues, Expenses, and Income. Table 1. The radio industry expects at least a 10% increase for 1966. Broadcasting Magazine, p. 31, Oct. 17, 1966. 30 Statement of Douglas A. Anello, General Counsel, National Association of Broadcasters. at Hearings before Subcommittee on Patents, Trademarks and Copyrights of Senate Judiciary Committee, April 12, 1967. 31 Library of Cong. Study at 96. Based on an industry-wide average for 1955-64 of 8.8% of net record company sales. Hearings before Subcommittee No. 3 of the House Committee on the Judiciary on Copyright Law Revision, 89th Cong., 1st Sess., 803 (1965). Jukebox purchases account for 6% of total dollar volume of records sold. H.R. Rep. No. 83, 90th Cong., 1st Sess., 83 (1967). Protection for the performers is urgently needed today, as it has been needed for many years, to correct this injustice. The Copyright law has not been materially revised since 1909 and possibly will not see another revision for the coming 50 years. The reason that performers on sound recordings were not included in the present law is obvious. The phonograph was but a toy and there were not the vast radio and jukebox industries that exist today. There was no protection in 1909 because it was not needed. The courts have many times since then recognized the injustice of the present law but have been powerless to correct it. Performers appeared before Congress in 1936 and again in 1947 asking for the same relief that they seek today. If they are denied copyright protection now, another 50 years could pass before they have another opportunity to seek protection of their intellectual property, the products of their creative genius. The performing artist, the composer and the record producer are engaged in a mutually creative effort and the successful presentation of that effort is dedependent upon the creative talents of all. The composer requires the interpretive talents of the performer to give his composition life and transform it into sound, and the artist requires the written sheet music of the composer to give him a blueprint upon which to structure and display his creativity. Yet under the present copyright law, there is a major difference between the rewards going to the composer and the performer. It is only the composer whose creation is protected from the appropriation by others for profit. It is only the composer who is rewarded for the performance of his recorded works. It is only the composed and not the performing artist whose "sacrificial days devoted to such creative activities... [are rewarded] commensurate with the services rendered." Great industries have developed which exist primarily, if not solely, by profiting from the use of recorded music. These industries are fully capable of paying for their main product which they now obtain virtually free; yet pay nothing to the record performer for the use of his intellectual product. There is no moral, legal, or economic justification for denying record performers the rewards afforded to all other artists. The National Committee for the Recording Arts strongly urges that Congress grant to record performers the same copyright protection granted to all other artists, the right to be rewarded for the commercial performance of their creations. CHAPMAN, DISALLE & FRIEDMAN. By MICHAEL V. DISALLE. SHELDON I. COHEN. Hon. JOHN L. MCCLELLAN, NATIONAL COUNCIL OF TEACHERS OF ENGLISH, Chairman, Subcommittee on Patents, Trademarks, and Copyrights, Senate Office Building, Washington, D.C. DEAR MR. MCCLELLAN: On March 16, 1967, John C. Maxwell, elected chairman of the Secondary Section of the National Council of Teachers of English, presented oral and written testimony on the Council's behalf in connection with the proposals for a revised copyright law. In this role, he joined other spokesmen from the Ad Hoc Committee of Educational Organizations, of which NCTE has been an enthusiastic member since the inception of this committee. Later, we learned, a spokesman for the Music Publishers Association requested changes in the wording of Section 107 dealing with fair use. We strongly oppose these changes on two grounds. The wording of Section 107 as it appears in the Senate's proposed bill came out of two "summit meetings" called by the Register to bring together three segments of the interested public. None of us came away from those sessions feeling he had won everything he could hope for, or everything that his constituents would like. But such a goal was not and could not have been Mr. Kaminstein's purpose in calling those meeting. It was a clear impasse that led us all into those sessions and disposed us all to work out the compromise reflected in the present wording. We did not leave feeling victorious; rather, we left feeling that three related professions had worked to solve differences and to accept what seemed like the best possible resolution of differences. Consequently, we are opposed in principle to a change in the wording of this particular section of the bill, short of any difference that would come out of the same setting-a summit conference. In addition to this question of principle, we are opposed to the substantive changes proposed by the Music Publishers Association. First, to return to the wording of the 1965 House Bill, with respect to fair use, is unthinkablę. It was precisely the patent unworkableness of this solution that caused the agony and hostilities that preceded the "summit conferences" and that led to the present wording. Returning to the 1965 wording would simply recreate the arguments of 1965. There is a second substantive suggestion which we must oppose that the same kind of copyright notice which we have agreed is to appear in material for which permission has been sought and fees paid must also appear on the transitory materials that teachers fairly copy for use in their own classroom. This additional requirement would violate the very principle governing the fair use provision for teachers. Involved in the fair use principle was the search for that combination of freedom and discipline that would permit a teacher to seize the moment, to capitalize on the teaching situation without any discernable loss of the author. In the summit meetings referred to above, publishers were quite willing to admit, informally at least, that the whole problem of permissions was a cumbersome one, that requests for information about original copyright ownership as well as about fees were difficult if not impossible to handle promptly. If the proposal were made a condition for fair copying, it would eliminate the possibility of spontaneous copying, which is at the heart of the matter. There are, to be sure, a number of points at which NCTE would also like the option of suggesting changes in wording of the law. Yet, we were a party to the conferences called by the Register of Copyrights and feel that the agreements worked out there demand our support. It was with this conviction that we devoted most of our testimony to changes in the wording of the report that would clarify the principals to which we lent our name and still give our support. We realize that drafting a satisfactory Bill is no mean task. Even so, we recognize that simply passing such a Bill leaves work for all of us. There is the qually important undertaking of informing those affected by the Bill just what it means for them. Here we are prepared and have already made preliminary plans to meet with our colleagues in the publishing industry to draft a statement of ethics which would clarify the Bill as it applies both to teachers of English and to those who control copyrighted materials used by English teachers. But here, we believe, is the proper setting for further refinement. We regret the introduction of testimony which disregards the delicate balance of interests achieved by the present wording and which might suggest to the Subcommittee that the coordination of interests is still at a relatively primitive stage. Sincerely yours, JAMES R. SQUIRE, Executive Secretary. ADDENDUM The National Council of Teachers of English wishes to submit the following addendum to its statement of position on S. 597, presented to the Subcommittee on Patents, Trademarks, and Copyrights March 16, 1967, by Dr. John C. Maxwell. Our concern is specifically with Section 302, "Duration of Copyright: Works created on or after January 1, 1968." This proposed section would substitute a life plus fifty year copyright term for the current practice, which allows the author a twenty-eight year copyright term with an option to renew the copyright for twenty-eight more years. The Subcommittee has already heard testimony from at least one spokesman for authors supporting the change. Yet subsequent discussion with other authors and further study of this proposal have revealed problems which were not apparent before. Although the intent seems to be that of insuring greater protection for the author and his heirs, in at least two senses it fails to do so. First, where an author's book has been allowed by the publisher to go out of print, the author has no alternative means for getting it back into print. Although certain works of popular fiction reach an early zenith and then fall out of favor even before they go out of print, such is not the case with some scholarly publications. Where there is some demand for a work but perhaps not sufficient to warrant publication in a hardback edition, a paperback reprint may be both feasible and profitable. Yet, except at the pleasure of the publisher, such an option is now denied the author for the duration of the copyright period. The proposed law only extends this period of denial. Consequently, we ask that the law include some provision for the copyright to revert to the author after a work has gone out of print and after a reasonable period during which there have been no sales and no royalties to the author. If we suggest a five-year span of inactivity as a reasonable period, it is not that we regard this span as desirable a priori, but rather to present a specific proposal for the Subcommittee's reaction. Our second concern for the author pivots on his loss of a key bargaining position which he now enjoys at the end of the first twenty-eight year period. Where the work has grown in popularity or the author's reputation has gained in stature, the current practice of renegotiating for a second copyright term provides the author with the opportunity to see these changes in circumstances reflected in the provisions of the contract for renewal. (In the meantime, the 85 percent of all works that are not commercially valuable are properly allowed to fall into the public domain at the end of the first twenty-eight year period.) Under the proposed law, the author would have no such bargaining advantage or opportunity. It was in recognition of the unequal bargaining position between an author and his publisher that the Congress in 1909 decided in favor of the present system. The principle of a longer single period was then rejected on the premise that "it was distinctly to the advantage of the author to preserve the renewal period." Conceding changes in print technology and in longevity of authors, we see nothing advanced which points to a different relationship between authors and publishers. In considering whether or not the proposed extension of copyright is necessary, it is important not to forget that the purpose of the copyright law is to promote the progress of science and the useful arts. Copyright is not basically for the benefit of the authors or any particular class of persons but for the public in general. To provide an incentive for authors the Constitution does state that Congress shall have the power to promote the progress of science and the useful arts by securing for limited times to authors and inventors the exclusive right to their respective rights and discoveries. But this again is primarly for the benefit of the public because it stimulates writings. Authors quite naturally argue that additional extensions of their monopoly will further stimulate writings and better fulfill the purpose of the Constitution. In contrast the public interest would seem to dictate early passage of copyright material into the public domain in order that it can be freely used by everyone. Any further extensions of the monopoly would seem to run against the dictates of public interest. Consequently, the question arises, will further extensions of the copyright monopoly better serve science and the useful arts? The following figures from the Register of Copyright's 1961 Report indicate that further extensions are unnecessary: Adding the present copyright duration of 56 years to the above figures, authors can receive royalties until: Years Average age of authors when copyright of first book published expires____ 88 120 Hence, under the present statute authors are, in general, protected for their life times, and their heirs receive the benefits of the authors' copyrights for considerable lengths of time after their deaths. Considering this matter from the viewpoint of the public it would appear that the further withholding of the free use of writings beyond the present monopoly of 56 years does not best serve the provisions of the Constitution, and in fact may be unconstitutional. As Professor Kaplan has so aptly put it: "In a condition of society in which nearly all else is moving and obsolescing at an accelerating pace, in which businessmen are rarely moved by any but quick-return prospects, it seems to me passing strange to be now thinking of prolonging copyright. That scattered works may have commercial value after fifty-six years hardly seems a justification for keeping all works under wraps for another twenty years. We ought to recognize clearly that any increment of 1 H.R. Rep. 2222 (60th Cong., 2d Sess. 1909), p. 14. benefit to the author and publisher achieved by prolonging the period of protection is quite soon outrun by the burden imposed on others." 2 Let us be fair to the authors and composers, but let us also be fair to the users and the public. Let us recognize the truth of Lord Macaulay's observation: "The principle of copyright is this. It is a tax on readers for the purpose of giving a bounty to authors." Let us keep this tax as small and for as short a period as is consistent with providing the incentive to authors and composers. As much a tax as is necessary, but not a cent or for a day longer than is necessary. Much has been made of the virtue of conforming to the European copyright term of life plus 50 years. But before we take this step, let us carefully consider who will benefit from such a change. Early, the Ad Hoc Committee on Copyright Revision made clear that it did not believe teachers or scholars, in their roles as users and consumers, would gain. It is clear to us now that many authors would not gain either. Consequently, in the interests of the educator and the writer and the general public whom both serve, we ask the Subcommittee on Patents, Trademarks, and Copyright to re-examine Section 302 and to re-establish the provisions for term of copyright that exist under the present law. We earnestly believe that the present provisions governing duration of copyright better serve the interests and needs of writers, teachers, and scholars. WGBH, LOWELL INSTITUTE COOPERATIVE BROADCASTING COUNCIL, THOMAS BRENNAN, Esq., Chief Counsel, Subcommittee on Patents, Trademarks, and Copyrights, Old Senate Office Building, Washington, D.C. DEAR MR. BRENNAN: Submitted herewith are ten copies of a report on a survey of the educational radio stations of the United States with respect to the pending copyright law revision. The survey was conducted by National Educational Radio, a division of the National Association of Educational Broadcasters. The results of that survey were the subject of testimony by Mr. Jerrold Sandler, Executive Director of National Educational Radio, before the Subcommittee, on April 12, 1967. The present report presents the data which formed one basis for Mr. Sandler's conclusions as to the likely effect of various provisions of S. 597 on educational radio broadcasters. We believe this research is particularly important for the Subcommittee's attention because it represents a program-by-program analysis of all of the programs broadcast during one week by two-thirds of the National Educational Radio member stations. We sincerely hope that it may be considered by the Subcommittee in connection with their deliberation on S. 597. Respectfully submitted, Enclosures. MICHAEL E. HOBBS, Assistant to the General Manager. 2 Kaplan, An Unhurried View of Copyright (Columbia Univ. Press, New York, 1967), p. 115. |