new forms. For example, University Microfilms produces copies of articles and books to order by Xerography and allied methods of "reprography." It does so by permission of the original authors and publishers and it pays them royalties. In fact, it now provides most of the out-of-print books ordered from publishers. Other publishers are providing reprints of articles on demand; and are using the new methods of reprography to prepare anthologies and teaching materials custom-tailored to the specifications of individual teachers and educational institutions-again by authorization of the authors and publishers of the material, and on payment of royalties.

Actually, these organizations function as clearing houses as well as publishers. They secure permission from large numbers of authors to allow portions of their work to be reproduced in various quantities, even single copies, upon demand. This enables users to obtain authorized material from a single source. They also serve as clearing houses to collect and distribute to authors royalties for each such use of their work.

Of course, publishers themselves have served as clearing houses for their authors for many years. Each major publisher maintains a permissions department which, over the course of a year, grants many non-exclusive licenses to reproduce portions of an author's work in anthologies, textbooks, magazines and newspapers; and also to educational institutions and individual teachers who wish to reproduce portions of these works. Such permissions are granted upon payment of reasonable royalties; and the publisher distributes them to the authors.

As the House Report suggests (p. 65), it seems likely that new methods of ganting clearances and permissions, and collecting royalties, should be developed. We believe that they can; and we will participate in a continuing effort by all those concerned to develop such procedures.

"Reprography" is not the only new medium for communicating the work of authors. It is clear that computers and computer networks will soon become a principal means of disseminating much that authors write. One study, Copyright and Intellectual Property, by Professor Julius J. Marke (January 1967, published by the Fund for Advancement of Education), describes the manner in which computers are being used to store, retrieve and disseminate books and other writings; and the manner in which systems (some existing, some in process) will function in the next few years.

Professor Marke and experts whose views he reports (pp. 88-105) make it clear that "by providing copies of works stored in the computer, these systems will become publishers." They point out that the computer will store vast quantities of books and other written materials; it will reproduce them in full-sized printed copies; display their contents on television screens; and communicate them in other forms.

A computerized library center, and systems of such centers linked together, will serve thousands upon thousands of users-located great distances from the center. As the Register of Copyrights testified before your Committee last year, the new technology will permit "instant communications and reproduction of an author's work throughout the world." Professor Marke says:

... the computer in essence, assumes the role of a duplicating rather than a circulating library. One copy of a book fed into such a system can service all simultaneous demands for it; of course, this substitution for additional copies will vitally affect publishers, the traditional market" (pp. 92-93).

Needless to say, it will also vitally affect the author's royalty income.

As the House Report indicates (p. 54) there have been proposals to create partial exemptions to the author's right to require authorization and payment for the use of his work in computer systems. The House Judiciary Committee rejected these proposals, stating:

"Recognizing the proven impact that information storage and retrieval devices seem destined to have on authorship, communication, and human life itself, the committee is also aware of the dangers of legislating prematurely in this area of exploding technology. . . . The committee believes that, instead of trying to deal explicitly with computer uses, the statute should be general in terms and broad enough to allow for adjustment to future changes in patterns of reproduction and other uses of an author's works." (Italic supplied.)

We believe the House Committee's conclusion is sound and we respectfully urge your Committee to adopt the same approach. It would be premature-at this point-to legislate restrictions on the author's basic rights over the use of his work in a medium that might well become the principal means of communicat

ing it. Without adequate experience and understanding of the problems, needs and arrangements (for authorization and payment), Congress could freeze into the copyright law for years to come an exemption that might seriously impair, if not destroy, the author's opportunity to be compensated for these uses of his work. Previous experience with technological explosions in other copyright fields indicate how dangerous that could be. Radio and television were not envisioned when the 1909 Act was written. As they came into being they represented as radical a departure from the then conventional means of disseminating music and dramatic works, as the computer now represents vis-a-vis publishing. Had exemptions been written into the law for these new media, composers would have been deprived of the greater part of their livelihood-for in a few years radio completely displaced the sale of published music as the source of the composer's income. And radio, the talking picture, and television each in its turn became a vital medium for the presentation of dramatic works-although in 1909 the living stage was the only practical means of doing so.

In all of these instances, the Copyright Law had preserved, in broad terms, the author's right to require permission and payment for the use of his work, and authors and publishers did work out arrangements under which their works were used, and paid for, in these new media.

In its Report, the House Committee

66

... expresses the hope that the interests involved will work together toward an ultimate solution of this problem in the light of experience" (p. 54). (Italic supplied.)

We agree that this must be done and authors will do so.

The Committee's Report continues:

"Toward this end the Register of Copyrights may find it appropriate to hold further meetings on this subject after the passage of the new law. In the meantime, however, Section 106 preserves the exclusive rights of the copyright owner with respect to reproductions of his work for input or storage in an information system" (p. 54).

In fact, the Register of Copyrights is now holding such meetings with the groups interested in, and vitally affected by, the new computer medium. We believe the meetings should continue while the Bill is being acted on by the Congress and after it is passed. However, for the reasons indicated by the House Committee, we do not believe that its enactment should be delayed until the parties involved reach a satisfactory accommodation. It is obvious that all sides require further study, knowledge and experience to determine what copyrighted materials the new computer systems will require, what uses they will make of them, what will be the most feasible and efficient methods by which the creators of these copyrighted works can authorize their uses by the new systems, and the most practical methods for determining and paying compensation to copyright owners for such uses.

We think that with a determined and continuing effort the groups involved will be able to formulate the necessary arrangements. Moreover, we believe their efforts can be aided by an intensive and continuing study of the problems involved. We suggest, as have others, that the study be conducted by a panel of experts appointed by the Register of copyrights, or by your Committee and the House Judiciary Committee; that it be authorized to study the various factors and problems; and that it report its findings and recommendations to Congress within a specified period of time. We believe that the Panel's study, and the continuing meetings of the interested groups (held under the auspices of the Copyright Office), should within the next two to four years develop the information and experience necessary to reach an informed and equitable arrangement that will serve the best interests of all concerned-the creators of copyrighted works, those who operate and use the computer systems, and the public.

While study and investigation are required to determine how compensation for the uses of copyrighted works by computer systems should be measured, and how it should be paid, one thing is obvious at the outset. Computer systems can afford to pay for the uses of this material. We are concerned with systems that cost vast sums of money to create and operate. Those who build and sell the computers, programs and other materials will all be paid. Educational and other institutions, which will operate these facilities, will expend great sums to acquire the machines and materials, and run them. Reporting on IBM's entry into the "education market," Forbes magazine (Sept. 15, 1966, p. 60) said:

"Even IBM speaks with awe of the vast size of the market. Total expenditures on education in this country reached about $45 billion in 1965, and federal govern

ment expenditures in this area, which are currently running at $8.4 billion, are expected to rise significantly by 1971."

And, as FORBES reported:

"RCA, General Electric, Raytheon and Xerox-makers of computers or related gear-[have] followed IBM's lead."

The author's ambitions are far more modest than those of IBM or others involved in the production or management of computer systems-educational or otherwise. All that he asks is that the Copyright Law preserve his rights in the works he creates so that he will be fairly compensated when they are used in this vast, and well-financed, new medium.

The Exceptions to the Right of Performance: Section 110.-In place of the present "for profit" exception to the right of public performance of musical and nondramatic literary works, the Revision Bill specifically defines the exceptions under which performance and display of copyrighted works could be made without the author's consent and compensation.

Classroom Teaching: Section 110(1).-Allows the "free" performance or exhibition of any work in the course of face-to-face classroom teaching in nonprofit educational institutions, as under the present law. We believe this exemption, together with the analysis in the House Report (pp. 66-71), is reasonable and that authors could live with it.

Protection of Dramatic Works: It is particularly important that the unauthorized use of dramatic and dramatico-musical works should not be permitted beyond the scope of such face-to-face teaching activities. The Bill preserves the dramatist's essential exclusive right over all public performances of his work, whether for profit or not, whether by schools, commercial theatres, or "open" or "closed circuit" educational television.

As the Copyright Office has noted, the "for profit" exception has never applied to any public performances of plays and dramatico-musical works because of the serious damage that such performances would cause dramatists. A public performance of a play or musical, whether or not for profit, diminishes the potential audience for other performances. In this respect these works are far more vulnerable to unauthorized performances than are musical and non-dramatic literary works. The dramatist must retain the right to determine who can publicly perform his play, and when and where it may be performed. Unauthorized performances, by one class of users, whether or not for profit, can destroy valuable opportunities to have the work performed elsewhere for profit-by professional theatres in various parts of the country, in motion pictures or on television.

Moreover, public performance of his work-whether or not for profit-is the primary, and usually the only, source of income for the dramatist. For many dramatists, the modest fees they receive from performances of their plays in schools, colleges and universities are a principal means of compensation for their work, often the only income from plays of merit that are never performed profitably, or at all, in the professional theatre. Some dramatists write plays intended solely for production in educational institutions.

Any further exception which permitted the unathorized performance of dramatic or dramatical-musical works by educational closed circuit television or any other means [beyond the face-to-face teaching exception of section 110 (1)] would be severely damaging to American dramatists.

We strongly urge your committee to preserve this aspect of the Revision Bill in its present form and to reject any proposals to dilute the protection which it gives to the dramatist's indispensable right of public performance.

Open Circuit “Educational" Broadcasts: Section 110(2) would permit the unauthorized use of non-dramatic literary and musical works on "open circuit" broadcasts by "non-profit" stations, if they were made primarily for reception in classrooms as a regular part of the systematic instructional activities of a nonprofit educational institution. The section also requires that such broadcasts be limited to a radius of 100 miles.

The House Committee's Report indicates (pp. 70-74) that this section is a compromise. The Bill grants the author the right to be compensated when his works are broadcast to the public on open-circuit television by a non-profit station, a right the Committee found he was well entitled to have.

The Committee felt, however, that broadcasts of non-dramatic literary and musical material which were an integral part of a classroom teaching program should be permitted, without authorization. But it recognized that such broadcasts also reached the public and that it would be unfair and damaging to authors if they were allowed to be disseminated over wide areas-by networks of public

stations, satellites and other means. Hence it limited this exemption to broadcasts within a hundred-mile radius of the transmitter. We urge that this limitation be preserved in the Bill.

Section 112(2) of the Bill permits non-profit, open-circuit broadcasting stations to make recordings of any program, subject to limitations on the number and period of use. This recording right, which non-profit public (or other) television stations do not now have, greatly increases the audience reached by their use of musical and non-dramatic literary works on broadcasts which are exempt from copyright under section 110(2). Recordings of these exempt broadcasts can be sent from station to station, thereby disseminating the author's work to vastly greater audiences than are reached when a broadcast is done "live."

The limitations on recordings provide at least some safeguard for authors and should be preserved in the Bill.

Except for the foregoing exemptions, the Bill grants the authors of musical and non-dramatic literary works the right to be compensated when their work is performed by non-profit, television and radio broadcasters (a right which the present law has always granted for dramatic and dramatico-musical works). As the House Committee concluded, authors are entitled to this right. The use of a book, poem or composition on an open-circuit broadcast has the same consequences whether the station operates for profit, or not. In either case it reaches a wide audience. In either case the author's work has value to him, the public and the broadcaster— it is program material for which an educational station would pay if it were written to order. In either case, the broadcast can diminish the value of the author's work in other media. The labels "educational" or "non-profit" do not justify depriving the author of the right to be paid for use of his work in this public medium. Indeed, as the Carnegie Commission on Educational Television points out, the term "public television" is really more appropriate for the medium. A performance of a symphony by Aaron Copland, or the reading of poetry by Marianne Moore, is as much educational when broadcast by a commercial station that pays for the right, as it is when broadcast by a "non-profit" station that does not; and as much entertainment to the audience of the non-profit station as to that of the commercial broadcaster.

As a stimulus to the creative arts, an exception that permits such unauthorized uses of non-dramatic, literary and musical works is completely self-defeating. Public broadcasting of classical music, poetry and similar works is one of the few means by which they are communicated; and therefore one of the few possible sources of compensation to their authors. These artists can least afford to lose income from these uses because so few others are available to them. A "for profit" exception would, therefore, pose the paradox that the expansion of "non-profit” public broadcasting will increase the uncompensated uses of many authors' worksand also diminish their earnings from other sources.

To deny an author compensation for the use of his liteary or musical works on a public broadcast seems to us patently unfair. These stations pay salaries to their staffs and pay for all of their other services and facilities, which are used to transmit the author's work. Certainly he is equally entitled to reasonable compensation for the contribution he makes to this medium. We think that this is particularly important to recognize at a time when serious proposals have been made to provide a very substantial increase in funds for the use of public broadcasting and Federal monies being appropriated for that purpose.

The fear that non-profit broadcasters would be overcharged by authors and composers is unwarranted. Royalties will, as they do in other media, find a level appropriate to the nature of the use. Thousands of copyrighted works compete in the marketplace; there are thousands upon thousands more available in the public domain. Arrangements for the licensing of uses can be developed, as they have been elsewhere. And, the fact that some authors may not authorize the use of a work at a particular time is hardly a reason for depriving them of their rights in their literary property. An author may refuse to permit his work to be used in one medium to protect valuable commercial rights in other media. This is not an heinous offense. Nor does it diminish to any meaningful extent the inexhaustible reservoir of available copyrighted, and public domain, works, which could be used.

The Manufacturing Clause: Section 601.-The Manufacturing Clause (sec. 16 of the present act) imposes upon American authors the severe penalty of loss of copyright as a means of enforcing a tariff-restriction on the importation of copies of their works from abroad. For the reasons noted in our statement to the House Committee, the manufacturing clause is utterly inequitable. Moreover, it discriminates against American authors of books; it does not impose these restrictions or penalties on foreign authors, nor on American authors of other types of works.

The Revision Bill makes substantial modifications in the present clause which eliminate most of these inequities. We strongly urge your Committee to accept section 601 in its present form and to reject any proposals to reintroduce any of the onerous provisions of the present clause.

Other Exceptions to Copyright Protection: We have addressed ourselves primarily to those exceptions to copyright which primarily affect writers and dramatists, whose works are first disseminated by publication or performance of the stage. This does not mean we are unconcerned or unmindful of the need for correcting certain basic inequities in the present law which affect our fellow authors, especially composers.

We only comment on these briefly because they will be discussed by representatives of other authors' and publishers' organizations.

The Juke-Box Exemption: We urge that the Revision Bill adopt a solution to the "Juke-Box" exemption (Sec. 1 (e)) which will permit the composers of music to obtain equitable compensation for the use of their music in this commercial and highly profitable medium of communication. We believe that the organizations representing American composers have made every effort to work out a reasonable solution to this problem; and we earnestly hope that Sec. 116 of the Revision Bill will be drawn in a manner that allows them to obtain reasonable payment for their works.

The Compulsory License Clause: Section 115 of the Bill provides for an increase in the statutory 2¢ fee payable to composers for recordings of their works made under the compulsory license clause. This is a maximum fee the composer cannot demand more; and the recording company is free to bargain for less, as it is (and does) today. The increase proposed by the Bill is modest and represents, in our view, the very minimum to which composers are entitled under this clause.

Community Antennae Television and Other Secondary Transmissions: Section 111.--We believe that any clause dealing with the problem of CATV must take account of Judge Herland's realistic appraisal of the nature of the CATV industry and its operations. He noted that CATV companies are "large scale commercial enterprises, advertising and promoting television programs and making profit out of the exhibition of television programs." Their function is not "simply that of passive 'antennaes' used only to receive telecasts." As he noted, the function they perform is "substantially identical to that of a network affiliated station." For the reasons noted in the statement we submitted to your Committee during its hearings last year, we believe that the provisions of Sec. 111 would serve to prevent creators of copyrighted works from negotiating for reasonable fees for the use of their works by CATV systems. We believe that more equitable and workable provisions could be drawn.

Termination of Transfers and Licenses Granted by an Author: Section 203.--The Revision Bill places a 35-year time limit on long-term transfers of an author's rights in his work. The termination clause is one of the most important provisions in the Bill. Like the present renewal clause, its purpose is to safeguard the author against being compelled to transfer his rights for the entire copyright term. Often, these transfers deprive him, and his family, of income from uses of a work during the latter part of its copyright. (The present copyright renewal clause automatically terminates any transfer of rights at the end of the first copyright term, where the author has died before the renewal year. This permits his heirs to make new dispositions of the work during the second 28 years of copyright.) As the House Report notes (p. 119) this clause represents a compromise between those concerned with the problem. The Section appears to have been accepted by all interested groups. However, should there be any opposition to it, we respectfully urge your Committee to consider our views on the problem set forth in our statement to the House Committee.

Statutory Damages: Section 504(c)(2).—The Revision Bill adopts a $20,000 maximum for statutory damages awarded by the Court in the case of a wilful infringement. There is no limit in the present statute. The remedy of statutory damages, fixed in such amount "as the Court considers just" is an essential remedy for the protection of copyrighted works against wilful infringement. Often actual damages are difficult to ascertain, although the evidence makes it clear that the copyright owner has been seriously injured. It is unquestioned that the District Courts have not abused their discretion in awarding statutory damages, and that the Circuit Courts of Appeal are available to correct any errors of judgment by the Trial Judge. We believe that the imposition of a fixed ceiling may encourage infringements. Since the present Law has functioned fairly without any limitation in such cases, we urge that the maximum be deleted from section 504 (c) (2).