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that. It would be better if you reserved that for the National Commission's study, or hold another day of hearings on that subject.

That is the position of our statement.

Mr. LIEB. Congressman Pattison, the approach of 2223 is to leave the law, whatever it is with respect to computer usage, as it is and ask to turn the question over to the new National Commission.

Ms. LINDEN. I would like to add a couple of words, if I may.

I was on the Committee of Science and Technology, Executive Office of the White House, for 32 years. We debated this issue and we prepared voluminous reports on exactly this problem. The fact is that the cost in time, energy, and money, the millions and millions of dollars it costs to create input, to create the storage and the memory core of the computerized information storage and retrieval system, is such that if we, in the interim, prior to the resolution of the problem by the National Commission, permit free input, the cost of reverting to the old system and protecting input, I submit, will, for practical purposes and realistically, be impossible. Once you free the geese, they fly away. It is impossible to recapture them again.

This is a short-form urging of what is an extremely complex concept of computerized uses and processing of information.

One of the basic issues which this committee has not averted to-and rightly so, because it is being left to the National Commission-is the problem of censorship. I would simply whet your appetite by using that word. The serious problem in censorship that computerized information storage and retrieval systems would cause if input were left, as I say, as the freed geese. This is a subject that warrants not only the attention of this committee, but serious study of the National Commission and careful reporting back for your consideration.

Mr. KASTEN MEIER. On behalf of the committee. I thank you for your appearance this morning-I should now say this afternoon. We will see you again in the context of this particular issue, perhaps, or others, on June 4: the committee will be exposed to the jukebox issue and the tribunal issue. And we will have as witnesses the American Society of Composers, Authors & Publishers; Broadcast Music, Inc.; Music Operators of America; and the manufacturers of jukeboxes. Until that time, on June 4, at 10 o'clock in the morning, the subcommittee stands adjourned.

[Whereupon, at 1:30 p.m., the subcommittee adjourned.]
[The following statements were received for the record.]

STATEMENT OF ALBERT WARREN, CHAIRMAN, COPYRIGHT COMMITTEE, INDEPENDENT
NEWSLETTER ASSOCIATION

My name is Albert Warren. I am chairman of the Copyright Committee of the Independent Newsletter Association. I am publisher of Television Digest with Consumer Electronics. The other members of the Committee are Louis Rothschild, publisher of Food Chemical News, and David Swit, publisher of Product Safety Letter. All 3 newsletters are published in Washington.

We speak for newsletters which are true journalistic enterprises. We do not represent house organs, publicity devices and the like. We produce the publications of the type admitted to the Congressional Periodical Press Galleries under the rules of Congress which specify that the publications admitted are “published for profit and supported chiefly by advertising or by subscription, and owned and operated independently of any industry, business, association, or institution."

The newsletter industry is uniquely vulnerable to violations of copyright for the following reasons:

(1) The typical newsletter is very brief-comprising a few pages, often no more than 4-and is therefore susceptible to quick photocopying in its entirety.

(2) Since newsletters' income almost always comes from subscriptions alone, illegal reproduction and distribution have an immediate and devastating impact on the market for the publications.

(3) Newsletter publishing is small business in its truest sense. With very few exceptions, each of the thousands of newsletters published in the United States is the product of a few journalists-frequently only one-often assisted only by their families.

(4) A recent survey of the newsletter industry shows that 19% have 500 or fewer subscribers; 21.5%, 501-1,000; 21.5%, 1,001-2000; 28%, 2,001-5,000; 10%, more than 5,000. With the average subscription running about $50 yearly, it is starkly evident that the revenues of a typical newsletter constitute small business indeed.

Simple arithmetic demonstrates dramatically the drastic impact that even a limited amount of copying may have on the viability of a newsletter. A newsletter with 500 subscribers, charging $50 a year, has a gross revenue of $25,000. If illegal copying deprives the publisher of a mere 100 subscribers, he suffers a loss of $5,000-20% of his income.

Newsletter publishers simply do not have the economic strength to police and litigate violations of their copyrights. Indeed, many publishers do not even file their newsletters with the Register of Copyrights, believing that the cost of $300 per year isn't justified by the insignificant amount of protection provided under current law.

We recognize that no Act of Congress can provide complete and automatic freedom from jeopardy. However, we do believe that Congress can make it abundantly clear what constitutes a violation of our rights-so that we can quickly, without expensive and protracted litigation, prosecute violations when we discover them.

We believe that the intent of Congress in providing for "fair use" is eminently laudable. Our concern is that newsletters are peculiarly vulnerable to abuses of "fair use." The reproduction of even a single page of a newsletter-or frequent reproduction of even mere sentences or paragraphs on specific topics-can often provide a businessman with all he needs without cost, thus eliminating him as a source of revenue. In fact, many newsletters conduct surveys and analyses which result in a single critical number. The illegal copying of this single number can deprive the publisher of major revenues. For example, my own publication conducts a monthly survey of hundreds of retailers to determine sales of TV receivers and stereo instruments to the public; the results are shown in a brief tabulation. The theft of this tabulation or even a portion of it would vitiate the entire enterprise.

We recommend, therefore:

(1) Exclusion of newsletters from any "fair use" reproduction as provided in Sec. 107. However, since most of our subscribers are businessmen-and we have no desire to exclude students from access to our material-we believe that not-for-profit libraries should be allowed "fair use." We believe that corporate and other business-operated libraries should be excluded.

(2) Should your Committee conclude that no "fair use" exclusion be made for newsletters, we urge that copying of any portion of a newsletter be allowed only upon written permission of the publisher. Historically, most newsletter publishers are pleased to authorize such reproduction on an occasional basis.

(3) If your Committee finds neither of the foregoing warranted, we urge, at a minimum, that language such as the following be included, in referring to "fair use": "For newsletters, fair use shall include reproduction of 50% of any article or 150 words, whichever is less. Each tabulation or graph shall be considered a separate article. Persons reproducing portions of a newsletter, under this provision, shall furnish the publisher with copies of such reproductions. On request of the publisher, such person shall provide him with the names, affiliations, and addresses of the persons to whom such copies were distributed." We suggest that, under "Definitions." the following appear:

"A 'Newsletter' is a periodical published for profit and supported chiefly by subscription, and owned and operated independently of any industry, business. association, or institution."

In addition, we suggest that the provisions covering newsletters, regarding "fair use," be incorporated in a new Sec. 118.

STATEMENT OF F. J. VAN ANTWERPEN, EXECUTIVE SECRETARY, AMERICAN INSTITUTE OF CHEMICAL ENGINEERS, ANd President, COUNCIL OF ENGINEERING AND SCIENTIFIC SOCIETY EXECUTIVES, AND ALBERT BATKIN, CHAIRMAN OF COMMITTEE ON PUBLICATIONS, COUNCIL OF ENGINEERING AND SCIENTIFIC SOCIETY EXECUTIVES

Mr. Chairman: My name is F. J. VanAntwerpen, Executive Secretary of the American Institute of Chemical Engineers, and President of the Council of Engineering and Scientific Society Executives. This Council is composed of the leaders of 80 national engineering and scientific societies and numerous similar local and Canadian organizations. In the United States alone, the cumulative society membership exceeds one million engineers and scientists.

The membership of these societies constitutes not only the users of the material disseminated but are, in fact, the authors. Therefore, they have a vital interest in the use and misuse of their material. The Council acting on behalf of the member societies and their membership in turn ask that you consider this in your deliberations. We feel that the provisions incorporated in the bill as passed by the Senate last year are equitable, although not as strong as some Societies may wish. We can live with it.

I have with me my associate, Albert Batik, Deputy Managing Director of the American Society for Testing and Materials, and Chairman for the Committee on Publications of our Council, who can give you additional information on our position.

Mr. Chairman: To give the Committee some perspective, I have data that may be useful. Of all the original scientific and engineering information published in the United States between 70 and 75% is published through the non-profit engineering and scientific societies.

These Societies depend on the income derived from the subscriptions and sale of their publications in varying degrees ranging from 20 to 80% of their total income. Most of the income is plowed back into a continuing information dissemination program. Virtually all the Societies work essentially on a break-even basis. Therefore, they have a vital interest in copyright legislation which will affect their income.

We recognize the position of libraries and other information centers that have limited budgets. However, faced with rising costs, and losing subscriptions to the copy machines, the societies find themselves in a rather awkward position. Subscription prices can be raised but this serves only to aggravate the situation and drives more subscribers to the copy machine. Keep in mind that the only beneficiaries in this troubled triangle are the manufacturers of the reproduc ing equipment. The true cost of this equipment is rarely recorded by the libraries and information centers, and the societies find their investments used free of charge to create income for a third party.

Societies can publish less. This would hinder the technical development of answers to the urgent problems facing the United States such as: solutions to the energy crisis, the abatement of pollution, and the delivery of adequate health services. The societies have a moral and ethical commitment to use their facilities to assist the nation in meeting its goals.

Societies can ask the Federal Government for subsidies to operate their publications and to make up for the loss of subscriptions. However, it is a well known fact that he who pays the piper calls the tune. In the technical field, vigorous debate and controversial positions are the keystone to arriving at adequate answers. A controlled technical press would be as regressive as a controlled social science press or a controlled news press. A number of other countries, at one time or another, have controlled their technical press much to their own detriment. Dissent in the technical sphere is essential, otherwise we would still be navigating on a flat world.

The Senate in the report accompanying the bill which was passed last year urged publishers and users to develop a system of reasonable royalties. I personally have participated in these negotiations and believe that a workable solution can be developed provided that no further exemptions be granted to users. As Mr. VanAntwerpen has stated, the Senate bill is livable and as is mandated in the accompanying report, a workable solution can go far to solving the problem at

hand.

STATEMENT OF DAVID MCCURRACH ON BEHALF OF THE NATIONAL SCHOOL AND EQUIPMENT ASSOCIATION

Mr. Chairman and members of the subcommittee, my name is David McCurrach, and I am Executive Vice President of the National School Supply and Equipment Association (NSSEA), 1500 Wilson Boulevard, Arlington, Virginia. Our membership is comprised of upwards of 470 companies which are involved in manufacturing and distributing supplies and equipment to schools all across the United States.

One of the significant contributions which we make to the educational process is in the area of instructional materials. Instructional materials include a wide variety of nontext supplemental aids to teaching which range from printed materials such as workbooks, exercises, flashcards and learning cards of all types, to newer audio-visual materials such as transparencies for projection. films, and learning records. The development of these new materials bas made it possible for teachers to make learning more varied, more interesting, and more effective.

Because of the great importance of copyright protection, we have viewed with interest and concern the efforts of Congress over the last ten years to revise the 1909 Copyright Law to reflect new technologies and developments, Since instructional materials are designed for use in the classroom, there are substantial research and development costs in addition to the standard costs of publication. There would have been little incentive for the creators of instructional materials to devote the requisite time, money and effort to this undertaking, had there been no restrictions on the right of teachers and school officials to duplicare instructional materials once they were published.

The advent of photocopying, however, has undermined the efficacy of the copyright protection provided by law. The duplication of educational and instruetional materials occurs regularly on a large scale. In fact, many school officials and teachers believe that all such copying is legal because it has been done so consistently over such a long period of time. The practical problems in trying to monitor this activity combined with the lack of judicial guidelines in the area have made the enforcement of rights under the current law extremely difficult.

The future development and availability of these materials depends, in the large part, on the re-establishment and maintenance of adequate copyright protection. The interests of the people in the availability and wide dissemination of original works of authorship can best be assured where the author is reasonably compensated for his work. A recognition of this fact underlies copyright law. Without a clear statement of legislative policy on the right of the public to duplicate, the incentive to create instructional materials will disappear. Two provisions of the pending Copyright Revision Bill (H.R. 2223) are of greatest concern to NSSEA. Section 107 permits the duplication of copyrighted materials where it constitutes a "fair use" of the work. Section 110 exempts from copyright liability certain performances and "displays" of copyrighted material in teaching contexts.

It is our understanding that § 107 is not intended to change existing law. To the extent that this provision simply codifies standards which have been developed by the courts to determine what is a "fair use" of copyrighted materials, NSSEA would have no concern. We oppose, however, the pending amendments to H.R. 2223 which would broaden the scope of "fair use" and, in particular, the proposal which would exempt from liability for copyright infringement virtually all duplication of copyrighted materials used for nonprofit teaching purposes. Such a change in copyright protection would, we believe, threaten the future of instructional materials. Since schools are the only purchasers of instructional materials, large-scale duplication by schools would deprive the creators of those materials of the only market available to them. In the past, Congress has consistently refused to insulate educators from the obligation to pay royalties for duplicating copyrighted materials. NSSEA urges, Mr. Chairman, that you and the members of your Subcommittee not so insulate them now.

I would also like to take this opportunity to address my remarks to what may be some real problems in the bill as it is currently drafted. With reference to the section governing the "fair use" of copyright materials (§ 107), NSSEA is concerned that it will not adequately clarify the respective rights of creators and users in instructional materials. The standards set out in § 107 itself are extremely vague. Without further explanation, no teacher or school official would

be able to determine whether or not a given duplicating project would be permissible.

First, NSSEA believes that it is essential that explicit guidance be provided on what constitutes "fair use" with respect to the duplication of instructional materials. Guidelines which have been devised with printed textual materials in mind will not resolve the problem of instructional materials. Unlike textbooks, most instructional materials are designed expressly to be used in segments which relate to specific areas of study. For this reason, duplication of portions of an instructional material program is far more detrimental to the rights of their creators than comparable duplication of a portion of a textbook would be. We urge, therefore, that copying even small segments of such materials be deemed not to constitute a "fair use".

Secondly, the application of the doctrine of "fair use" to what have been termed "consumables" must be clarified. Unlike textbooks, many printed instructional materials, like workbooks and exercises, are consumed in use. Recognizing the particular problems raised by these materials, Congressional committees have consistently made clear that the privilege of "fair use" by teachers and students would have "little, if any, application" to "consumables". A spokesman for the Ad Hoc Committee on Copyright Law Revision of the American Council on Education testified before this Committee that they were not asking for the right to reproduce writings that are destroyed in use. Supporting the virtual unanimity among Congressional committees, the educational community and the creators of instructional materials that duplication of instructional materials which are consumed in the classroom should not be permitted, NSSEA recommends that $ 107 be amended accordingly.

Specific guidance is also needed on the application of § 107 to audio-visual materials. Due to the nature of audio-visual aids, no more than one set of a program is usually needed in any one classroom. And, often, a school will purchase only one of each program or set which will be rotated among the classrooms, Thus, even single duplications of these materials could have a significantly adverse impact on the audio-visual industry. NSSEA urges this committee to clarify § 107 and to set out express restrictions on the rights of educators to duplicate audio-visual materials.

The other section of H.R. 2223 which NSSEA finds particularly troubling is § 110, which exempts from liability certain displays of copyrighted materials in a teaching context. § 110(1) provides that the "display" of a copyrighted work in the course of "face-to-face teaching activities" in a classroom by teachers or pupils is not an infringement of copyright-and to "display" a work is defined as "to show a copy of it". Except for motion pictures and other "audio-visual" works, there is no requirement in the bill that such copy must be lawfully made in the first place. NSSEA believes that this provision is inconsistent with § 107 and could permit wholesale infringements of instructional material copyrights. Once the copy has been made of materials like sets of learning cards or slides, this exemption could allow teachers to use that copy freely thereafter without running any risk of copyright infringement. NSSEA believes that § 110 should be amended to restrict all the rights of "display" granted under this provision to copies which were lawfully made in the first instance. Clearly, your legislation should not create the circumstances whereby one section of the law permits people to do indirectly what another section forbids them to do directly.

In conclusion, Mr. Chairman, NSSEA commends the efforts of this committee to revise our existing copyright laws and to resolve the problems created by the rapid technological changes of the last few decades. The question of photocopying is clearly one of the most troublesome now facing your committee. The interests of educators and users, however, would be best protected in the long run by the maintenance of copyright protection which is sufficient to encourage and reward the further development of new educational methods and instructional materials. 1S. Rep. No. 93-983, 93rd Cong., 2d Sess., at p. 117 (1974); H.R. Rep. No. 83, 90th Cong., 1st Sess., at p. 34 (1967).

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