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I cannot believe there would be any broadcasting rights of value left in Milwaukee if this should happen. The same thing is true of Minnesota, where the Twins play. All of those 277 games from Chicago would be available to go into Minnesota with a devastating effect, in my judgment, on the operation.
Senator MCCLELLAN. Do you have a blackout now against those games?
Mr. Kuhn. No; we do not. These are local games. With our local games, Mr. Chairman, there is no blackout provision at all.
To give you a further example, the Boston Red Sox and the Philadelphia Phillies are on either side of the New York market. Both New York teams telecast on independent stations. Their games would be available to go into both Philadelphia and Boston.
The Mets telecast 112 of their games, the Yankees 69. This is another 181 games that would be free to go into Philadelphia and Boston.
And again, Mr. Chairman, one doesn't need to be a bit sophisticated about this business to know the devastating impact that would have on the broadcast right of the Phillies and the Red Sox if in part or in whole that began to happen, and that it can happen, is demonstrated by a survey that CATV channels are being-the permits are being granted now in these markets, in Boston and Philadelphia. This is not something that we are speculating on, but this is the fact.
And as the CATV grows, and we hope it will, goodness knows where this may go in terms of its total impact; from the point of view of professional baseball, that is a pretty ghastly prospect, unless we are able to control the dissemination of our
broadcast rights, and that is all we ask for.
I think it is clear also to look at the realities that the CATV people readily admit that sports broadcasting is vital to them. There is no pretense that they are going to use some other kind of broadcasting; sports broadcasting is what they are hinging their prospect of success on.
In other words, they have said plainly that they intend to go extensively into sports broadcasting.
Now, I think something important in concluding, I should say, Mr. Chairman, is this: I think baseball has behaved very responsibly in terms of its obligations to the public in making its games available. In the first place between the majors and the minors, as I say, we have maintained this enormous entertainment network of 151 clubs and 151 markets around the country.
We play 2,000 major league games. We play 7,300 minor league games. I cannot tell you how important this entire system is. It draws over 40 million people, by far the largest of anything in professional sports. Over 40 million people are drawn to these events.
If we were difficult in our broadcast policies and didn't telecast a lot of these games, then I could say, I think the chairman should say to me, "Well, what have you got to complain about?" We do broadcast our games by television, very extensively. Of our 2,000 major league games nearly 1,100 are telecast annually, and not telecast over just one station, Mr. Chairman. We are currently telecasting over 173 television stations in and around our local markets through our local broadcasting contracts.
Now, if you will look at our national broadcast contract, there we were telecasting regularly over 190 NBC stations in the United States covering the country. There was a game every Saturday during the basebal season and a game on 15 Monday nights during the baseball season. NBC carries our all star game as they did last week, our league champion series and our world series. All of these are carried nationally all over the country.
So that literally hundreds and hundreds of thousands of hours of television time are provided today by major league baseball, I think a very responsible performance in our attempts of serving the public with pictures of our games. We feel that this has been a reasonable and fair performance on our part in terms of the public need and interest.
And I think that it is fair to assume that we will look at newly developing technologies and try to use them, given control of our product as we pray we shall be, and try to use them thoroughly in the public interest as we have in the past; as we have, for instance, with our world series games where there is no blackout. We telecast the world series not only in the cities where those games are being played, but all over the country as well. Knowing occasionally we may get a public relations blackeye because you may see a few empty seats here and there because we will televise right in the market, but we do in trying to serve the public interest and we feel we have behaved very responsibly in this way. So we do support the bill, and we very particularly support section 111.
And I thank you for your consideration.
Since hockey and baseball share similar player development problems, we like baseball must develop our own minor league players. We, too, have both our network television contract, extensive local contracts. We will support the remarks made by Mr. Kuhn.
Senator McCLELLAN. Thank you, sir.
Mr. VANDERSTAR. Mr. Chairman, I have submitted a statement on behalf of Commissioner Rozelle of the National Football League. Essentially what it does is warmly endorse and urge the enactment of those provisions in this bill which deal with carriage of sports on cable systems, in particular 111(c)(4)(C).
We have made a record before the committee and also before the Communications Commission about our need for this. We have tried to show that contrary to the comments repeatedly made by the cable industry, the purpose of Congress in 1961 in enacting Public Law 87-331 was to give the professional sports leagues the privilege to sell their games on a pool or joint package basis to a single network.
Congress knew full weil then when it enacted that exemption from the antitrust laws, that in allowing, in our case the NFL, to do that, we would be selling games in a fashion that would result in one game being telecast in each market.
Now, with the growth of more teams, with the amalgamation of the two leagues and so on, we are now in a position where in every market in the United States on Sunday afternoon there are two, and in most of them three, live telecasts of professional football games available to the viewing audience.
We think, and a good many other people think, that is plenty of professional football on television. We have structured the distribution of those games in a way that we think serves the public interest for a variety of reasons, and what we ask is that we be allowed to continue to do that, that we not lose control of any distribution of this product for financial reasons and other reasons as well, and that we not see cable systems allowed to continue and increase the practice of simply moving game telecasts throughout the country to suit their own interest and convenience, rather than ours or the public's, as we see it.
That is our position.
For the record, the Chair observes we are going to have a rollcall vote, only it came quicker than I thought, so I'm going to have to leave in a moment. If you can finish real quickly.
Mr. KAUFMAN. Mr. Chairman, we have submitted for the record the statement of Commissioner Kennedy of the National Basketball Association strongly supporting the provisions of the bill as they are.
I would like to point out two things, if there is time, that the committee should take into consideration. Professional basketball games like other professional games discussed here are not produced primarily for television. They do have a unique character. They are different from the other types of broadcasting material, to which the cable people refer.
They do not have a potential for reuse that other types of entertainment programs may have. They do not have the type of national acceptance with respect to a particular game; and for that reason, they do deserve special consideration.
Here we would also like to point out that there has been a discussion of the antitrust exemption which is, in our view, not quite complete. The antitrust exemption that was granted was granted with respect to pool broadcasts, because one was thought to be needed. No one ever felt that the decision of a team on a single basis to sell one game and not to sell another game needed congressional support.
And the marketing plans of the individual members of the National Basketball Association in their single game sales on a nonleague basis have been that they would sell as many games as possible without interfering with attendance.
The problem that they face with the cable situation is that the game which has been not sold at home, but which the visiting team is allowed to take back, was not sold for a specific economic reason, which was to preserve the gate. The cable proposes to bring that game back into the home team area, and in effect, to destroy the gate, which the team is trying to protect.
It places a terrible burden on the team to decide whether it will exclude the cameras of the away team in order to protect its very existence in terms of ticket sales, and that is a choice to which sports should not be put. The only result would be to deprive people of the ability to watch sports and not to add to the number of games that they receive. I think that is a point which should be taken into account.
Also, I would join with the other sports in the support of the bill in its present form.
Thank you, Mr. Chairman.
Senator McCLELLAN. All right.
[The prepared statements of the Professional Baseball Leagues, National Hockey League, American and National Football League and the National Basketball Association follow:]
STATEMENT ON BEHALF OF MAJOR LEAGUE AND MINOR LEAGUE BASEBALL, BY
BOWIE K. KUHN, COMMISSIONER OF BASEBALL, BEFORE THE U.S. SENATE COMMITTEE ON THE JUDICIARY, SUBCOMMITTEE ON PATENTS, TRADEMARKS AND COPYRIGHTS, IN SUPPORT OF S. 1361
Mr. Chairman, I appear here today in strong support of the provisions of Section 111(c) (4) (C) of S. 1361. I am appearing on behalf of the 24 Major League Clubs of both the American and the National Leagues as well as the 127 Minor League Clubs comprising Professional Baseball's system of 17 Minor Leagues.
The matter before the Subcommittee, of course, is the Copyright Revision Bill, S. 1361, for the general revision of the copyright law. Those portions of Section 111 which we support would, in effect, allow professional sports organizations like Baseball to continue to determine when and where their sporting events will be telecast.
Specifically, Section 111(c)(4)(C) of S. 1361 would ensure that professional sports will retain complete control over the transmission of a Club's games by cable television.
As you know, Professional Baseball over the past few years has provided this Subcommittee and successive Congresses dealing with the problem of copyright revision detailed evidence that the indiscriminate transmission of sports signals by cable television systems could do serious violence to attendance at Major League and Minor League games as well as critically undermine telecasting reve. nues upon which Professional Baseball's economic viability clearly depends. I appear here today for two compelling reasons :
(1) To urge the Subcommittee to hold fast to the letter and the spirit of Section 111(c) (4) (C) as the Subcommittee has drafted it and as the Subcommittee reported it when it last took formal action on the bill.
(2) To submit, for the Subcommittee's record, a detailed survey constituting dramatic new evidence illustrating that the uncontrolled and unlimited transmission of sports broadcasts by cable systems could totally disrupt Baseball's historic local and regional telecasting patterns—with the most serious consequences for Baseball's future.
At the outset, nevertheless, I want to emphasize that there are obvious public interest benefits inherent in the newly emerging cable television technology. Cable offers an opportunity for extending more programming, and more programming choices, to the American viewing public, especially in rural and other under-served areas. We will be most aware in times ahead of opportunities to experiment with all forms of the new technology-as long as we can assure that no fundamental damage is done to our existing television packages and the home gate. It must be recognized that Baseball's tradition as the national pastime has been considerably enhanced by the game's extensive exposure on network, regional, and local over-the-air telecasts. Today close to 60 percent of all Major League Baseball games are telecast, and this programming obviously constitutes a crucial ingredient in the maintenance of Baseball's economic health,
Thus, we must strike the most careful balance in any experiments with the new technology. The present provisions of Section 111 retain for us control over the telecast of our games. This will permit us to proceed in negotiations with the new technology in a fashion which will preserve the essential over-the-air role in our telecasting. As we point out, to give cable an across-the-board compulsory license to our telecasts would deprive us of the ability to proceed with controlled experimentation. I can assure you that the Commissioner's office will move forward reasonably and responsibly in any negotiations with cable interests.
I. SUMMARY OF BASEBALL'S POSITION Baseball's basic position on the merits of the copyright issue remains as follows:
A. Unrestricted cable transmission of Baseball games could seriously dilute the value of Baseball's television revenues and devastate home game attendance in both Major League and Minor League cities :
1S. 1361, 93rd Cong., 1st Sess. $ 111 (1973). See specifically Section 111(c)(4) (C).
(1) Baseball's television revenues currently constitute about 25 percent of its total operating revenues. Unrestricted cable transmission will surely have a crippling effect on this vital source of revenue underpinning Baseball's economic health. Unlimited cable carriage will destroy the exclusivity of local Baseball programming which each Club presently offers in major metropolitan areas, thus diluting the value of each Club's local and network broadcast package.
(2) Further, if there is no prohibition of unrestricted carriage of games, cable carriage can have a devastating effect on home gate attendance in Major League cities.
(3) Even if some form of a blackout restriction is adopted, this would leave cable free to import distant signals of competing games any time that a team is on the road despite the fact that most Major League teams telecast only away games back to the home city. These cablecasts would be in direct competition with-and seriously depreciate the value of—the television
package that a local club hos to offer. B. Televised Baseball is already widely available to the American public. Indeed, there is no lack of Baseball broadcasts over the air currently. Of the total of almost 2,000 scheduled Major League games during the 1971 season, close to 60 percent were televised. Nationally televised games over the 190 affiliates of the National Broadcasting Co. (NBC) include the NBC Game of the Week, the 15 Monday Night Games also carried nationwide, the two League championships, the All-Star Game, and the World Series.
Beyond the national network, each Club authorizes additional local and regional telecasts of its own games—in 1973 some 1,093 regular league games telecast on 173 different television stations.
Nevertheless, Baseball recognizes that there can be legitimate experimentation of televised Baseball on cable television systems so long as Baseball retains control of bargaining rights over cable carriage of Baseball games to ensure that its over-the-air broadcast package is not compromised.
C. Unrestricted cable carriage could destroy the Minor League system. In 1971, the 17 Minor Leagues (comprised of 127 individual U.S. teams) played more than 7,300 games before some 11 million fans. In many cities across this country, Minor League Baseball is the only live professional sports event available in the local community. Moreover, this extensive Minor League system is essential as a training ground for the Major Leagues—which spend approximately 25 percent of operating revenues ($31 million in 1969) for player development. Unrestricted cable-casting in Minor League communities would decimate home attendance.
New evidence confirms our earlier fears that unrestricted access to sports programming by the rapidly growing cable industry poses for Baseball problems of catastrophic proportions.
In order to secure a further factual foundation to our concerns, I commissioned a survey of each of the hundreds of cable television authorizations issued by the FCC over a year-long period to determine the extent to which the home territories of the various Major League Clubs are open to invasion by the importation of distant broadcast signals transmitting Baseball games.
The results of this survey dramatize Baseball's plight.
The FCC authorized 304 cable systems in territories of Major League Clubs during the first year following the adoption of its new cable rules (from March 31, 1792, to April 1, 1973). At least 171 of these cable systems—or 56 percent-will import signals of a distant TV station which telecasts the games of other Clubs. For instance, cable systems in the heart of the Philadelphia and Boston home territories have already been authorized by the FCC to carry the extensive telecast schedules of the New York Yankees and Mets from stations WPIX-TV and WOR-TV in New York. There is nothing either the Mets or Yankees can do to prevent this.
In the Boston Red Sox's home territory, eleven communities within 35 miles of downtown Boston have received authorizations from the FCC under the new cable television rules to carry the distant signals of the two New York telerision stations carrying the Yankees and the Mets, WPIX-TV and WOR-TV. In the Philadelphia Phillies' home territory, the New York invasion is also significant. Cable systems in twelve communities within 35 miles of the heart of Philadelphia will carry the Mets, and six cable systems will carry the Yankees.
The Minnesota Twins, thanks to the importation of WGN-TV, Chicago, into