Mechanical Royalties Have More Than Doubled D. E. Mechanical Royalties Outpace Inflation and Median Family Income, Mechanical Royalties Paid Per Released Tune Outpace Inflation F. Payments to Copyright Owners Would Go Up $47 Million G. H. Annual Cost to Consumers Could Go Up By $100 Million I. Rates Paid are Statutory Rate and Standard Variations J. In 1974 as in 1963 Tunes were Licensed at 24 or Standard K. No Economic Justification for an Increase FULL STATEMENT EXHIBITS 121 Page 123 123 123 123 123 124 124 124 124 124 125 1. STATUTORY LICENSE ROYALTIES AND RECORD COMPANY PRICE: 1974 1909 vs. 126 283. 4. INCOME TO COPYRIGHT OWNERS FROM RECORDINGS, 1973 vs. 1963 126 132 ESTIMATED FINANCIAL STATISTICS AND INCOME STATEMENT FOR THE US. 132 6. 7. 8. 9. 10. FINANCIAL IMPACTS OF PROPOSED INCREASED MECHANICAL ROYALTIES ON STATUTORY LICENSE ROYALTIES PER TOP 150 LP ALBUMS IN 1973 AT VARICKS 158 159 160 160 SUMMARY EXHIBITS For data supporting material in the "Summary Statement", see the appropriate sections in the full statement (pp. 33-118) and in this Technical Appendix. Exhibit A- No Economic Justification for an Increase This exhibit summarizes the conclusions of the full statement. The basis for the finding that copyright owners' income has outpaced inflation is provided in Section 1.B. of the full statement, pp. 37 to 43. increased statutory rate are spelled out in Section II.A. to II.D. of the full The impacts of an statement, pp. 56 to 81. Exhibit B -- Price Per Tune is Down; Copyright Owners' Share is Up This conclusion is based on Exhibit 1, p. 36. It should be noted that the price per tune received by record companies has declined in current dollars since 1909, even though today's product is far superior in quality. Exhibit C Mechanical Royalties Have More Than Doubled The data in this exhibit are based upon Exhibit 3 in the main report, p. 39. The source of the figures is CRI's financial survey of recording companies, which is explained in detail later in this appendix under "Exhibit Exhibit D-- Mechanical Royalties Cutpace Inflation and These data are also based on Exhibit 3 in the main report, p. 39. Data pertaining to the Consumer Price Index and Median Family Income are from the Statistical Abstract of the United States. P. 43. Exhibit E Mechanical Royalties Paid Per Released Tune These data are based upon the analysis in Exhibit 4 of the main report, The assumptions behind the exhibit are discussed later in this technical apperdix under "Exhibit 4". 124 Payments to Copyright Owners Would Go Up $47 Million De finting is explained on pages 56-60; the underlying data are to be found is test.rs 6 and 7, which are discussed in this appendix Suffice it to say here that the 14" million figure does not assume that all licenses would be paid at It is based on the study finding that the existing rate structure, with standard discounts off the statutory rate, would prevail -- but at a higher plateau for all rates This study finding is explained in Section II.E. of the f... statement Note that the increase in mechanical reyalties paid would be more than the sumpe 50% achieved by raising the rate from 2 to 3e because of the effect of the proposed playing time provision in Sec. 115 of H.R. 2223. (See Exhibit 6.) Latihan G -- Annual Cost to Consumers Could Go Up By $100 Million Calculation of the increase more precisely $97 6 million is shown is tub.bit 19, page 67 Note that the increase to Consumers is considerably e than the 14" million increase to recording companies. The logic for this 18 explained in this Technical Appendix under Exhibit 9. Tabahit M_--_ Breakeven Print Higher Than Ever These data come directly from Exhibit 13 of the main written report, p. 74 The soutre of that exhibit, a study conducted by Cambridge Research Institute in 1972, is discussed later in this appendix under "Exhibit 13′′. These per entages are computed directly from Exhibit 21, p 118, which is dbranted in full later in this Technical Appendix. The right hand side of this exhibit is computed from Exhibit 21, p 118 will be seen that 21 of the 2,593 tunes studies which had paying licenses, were paid at rates other than standard variations. This amounts to 0.8% of the tunes sampled. The left-hand side of Exhibit J is taken from the 1965 Statement of John Desmond Glover on H. R. 4347 Section 111 (c) (2). This concludes the section of the Technical Appendix covering the Summary exhibits. 125 |