So this is survival of the fittest, the Darwinian theory again. Mr. HUGHES. I understand. As I indicated at the outset, and this will be my last comment, that is why I indicated that our job is to ensure that the public good is served. We will certainly look at your testimony and the concerns, the legitimate concerns that you have raised, and we appreciate your contributions to this hearing today. Thank you very much. That concludes the testimony for today, and the subcommittee stands adjourned. [Whereupon, at 12:12 p.m., the subcommittee adjourned, to reconvene subject to the call of the Chair.] APPENDIXES APPENDIX 1.-LETTER FROM MICHAEL R. KLIPPER, VICE PRESIDENT, LEGAL AND GOVERNMENTAL AFFAIRS, ASSOCIATION OF AMERICAN PUBLISHERS, INC., TO HON. WILLIAM J. HUGHES, CHAIRMAN, SUBCOMMITTEE ON INTELLECTUAL PROPERTY AND JUDICIAL ADMINISTRATION, FEBRUARY 18, 1992 aap Association of American Publishers, Inc. 1718 Connecticut Avenue. N.W. / 8700 Telephone 202 232-3335 FAX 202 745-0894 February 18, 1992 The Honorable William Hughes Chairman, House Judiciary Subcommittee on Intellectual 207 Cannon House Office Building United States House of Representatives Washington. D.C. 20515 Dear Mr. Chairman: Following are the comments of the Association of American Publishers ("AAP") with respect to H.R. 3204, the Audio Home Recording Act of 1991. We respectfully request that this letter be made part of the formal hearing record on H.R. 3204. As this Subcommittee is well aware, for many years the issue of unauthorized home taping of music has been a much-debated and contentious one. In the past representatives of the music and the consumer electronics industries have engaged in a time consuming and fractious debate focusing, in large part, on the impact of new audio electronics technologies on the economic well-being of those who create music and make a vast array of musical works available to consumers both here and abroad. A milestone was reached last July when the participants in the audio home taping debate announced their support for the legislative solution embodied in the bill now before this Subcommittee. AAP applauds those parties that have devoted so much time and effort to resolving the dispute over the home taping of music. At the same time, however, AAP believes that, as presently drafted, the pending legislation extends beyond the issue of audio home taping of prerecorded music and affects directly the interests of various book publishers publishers who were neither immersed in this long-standing dispute between the music industry and the audio hardware manufacturers, nor party to the negotiations that led to the "historic compromise" reflected in the bill. H.R. 3204 impacts on the interests of the publishers of so-called "spoken word recordings," e.g., audio book or books on tape, recordings of instructional materials and conference proceedings · which contain no musical sounds or musical sounds that are only incidental to spoken words fixed in the recording. In particular, the bill denies these publishers both the right to sue for copyright infringement under certain circumstances and the right to share in the royalty pool created under the bill. The legislation's impact on these "spoken word recordings" is of great concern to various members of AAP. The market for spoken word recordings is a growing one. For example, it is estimated that in 1991 audio book sales totaled approximately $850 million. In addition, sales of spoken word technical and training materials total approximately $50 million per year. In its current form, H.R. 3204 treats these "spoken word recordings" differently from the musical recordings that are the focus of this legislation; and, by doing so, we submit, H.R. 3204 affects "spoken word recordings" in a manner that warrants legislative correction. Significantly, although spoken word recordings fixed in phonorecords are covered by Section 1002 of H.R. 3204 -- thereby preventing "spoken word" copyright owners from protecting their rights by bringing copyright infringement suits against noncommercial copying -- these same copyright owners are denied the right to participate in the royalty pool created under the bill. This is so because the royalty pool applies only to musical works and the recorded musical works themselves. Thus, as now drafted this legislation unfairly discriminates against "spoken word recordings." It effectively creates an uncompensated exemption from copyright liability for unauthorized, non-commercial duplications of spoken word recordings. To remedy this situation, AAP urges this Subcommittee to amend H.R. 3204 to exclude "spoken word recordings" from the scope of the bill. In AAP's view, this result can be best accomplished by amending H.R. 3204 to provide that for purposes of this legislation, phonorecords do not include material objects in which are fixed "spoken word recordings." We have discussed this approach both with Subcommittee staff and representatives of the proponents of H.R. 3204. Mr. Chairman, as the result of a series of our discussions with the proponents, we have agreed jointly on the language of a suggested amendment to H.R. 3204. We hope that you and your colleagues will endorse an amendment along these lines: For the purposes of this chapter, phonorecord does not include a material object in which the fixed sounds consist entirely of spoken word recordings. A "spoken word recording" is a sound recording in which are fixed only a series of spoken words, except that the spoken words may be accompanied by incidental musical or other sounds. It is our understanding that the proponents of the bill will, consistent with the current version of the Senate bill, advocate that the word "audiogram" be substituted for "phonorecord". Should that change be made, the suggested amendment should be modified accordingly. In AAP's view, this language will accomplish the important purpose of removing "spoken word recordings" from the reach of this legislation. Under the proposed language, for example, "audio books" or "books on tape" that contain only spoken words are excluded from the bill. In addition, various other works, including "audio books" or "books on tape" that may use incidental music e.g., to serve as a bridge between chapters or sections, also would be outside the scope of H.R. 3204. Mr. Chairman, it is AAP's position that the inclusion of the "spoken word" language set out above is consistent with the other provisions in H.R. 3204 that are also designed to limit the reach of the legislation and to focus the proposal on private, home copying of prerecorded music. For example, expressly excluded from the definition of "digital audio recording device" are among other things, "dictation machines, answering machines, and other audio recording equipment that is designed and marketed primarily for the creation of sound recordings resulting from the fixation of nonmusical sounds" (Section 1001 (3)(B)). Similarly, the definition of "digital audio recording medium" specifically excludes a material object "that is primarily marketed and most commonly used by consumers either for the purpose of making copies of motion pictures or other audiovisual works or for the purpose of making copies of nonmusical literary works, including, without limitation, computer programs or databases" (Section 1001 (4)(B)(ii)). AAP submits that the suggested "spoken word" amendment is in line with these and other narrowing provisions in H.R. 3204. - In addition, AAP urges that the bill be amended so as to delete "(2) EXAMPLE. - " from Section 1002, page 11, line 16. We have mentioned this suggested change to Subcommittee staff and we have also been informed that the bill's proponents do not object to this change. As AAP understands it, the purpose of the language following "(2) Example" is to make clear that the copying of a phonorecord by a consumer for private, noncommercial purposes is not for direct or indirect commercial advantage and thus is not actionable under the bill. AAP believes that this purpose can be better achieved by deleting "(2) Example." Mr. Chairman, AAP would be remiss if it did not take this opportunity to thank the representatives of the bill's proponents for their willingness to work with us to address the issues |