Mr. Chairman and Members of the Subcommittee: I appreciate
the opportunity to testify at this Oversight Hearing. My statement reviews
our operations, major accomplishments and challenges.
The last two years have been very busy ones for the Copyright Office not
only because of increased legislative mandates but also because of the changing
nature of activity in certain areas of title 17. The adoption of new fees
also increased the Office's work load. Despite the fact that its staffing
levels remained about the same, the Office managed to make great strides in
accomplishing these new responsibilities.
The Office responded aggressively to new Congressional directives including
those contained in the Digital Millennium Copyright Act of 1998. This legislation,
the most far reaching copyright bill in two decades, gave the Office new duties
and responsibilities in the areas of liability limitations for infringement
of copyright in a digital environment, for digital performance rights in sound
recordings, and protection for vessel hull designs. In addition, the Office
continued its role of advisor to Congress on national and international issues,
and provided valuable and timely assistance to the United States Trade Representative
and other executive branch agencies. The Office also continued to create and
maintain the official public record of copyright registrations and recorded
documents, administered the various compulsory licenses and statutory obligations,
and provided technical, legal, and educational copyright assistance throughout
the world. The Office took major steps forward in its systematic development
and implementation of the CORDS system, a fully automated registration and
deposit system, successfully implementing during the past year an innovative
system-to-system communications capability for electronic submission of copyright
claims and deposits for digital dissertations from the office's largest remitter.
Additionally, the Office continued to make progress in providing a higher
level of security for materials submitted for copyright registration.
In fiscal year 1999, the Copyright Office received approximately 619,022
claims to copyright representing over 800,000 work, of which 594,501 were
registered. It recorded a total of 16,447 documents covering hundreds of thousands
of titles. It forwarded more than 603,000 copies of works, with a value of
more than $36 million dollars to the Library of Congress for its collections
and exchange programs.
The Office processed 21,299 filings from cable operators, satellite carriers,
and manufacturers and importers of digital audio recording devices and media,
and processed claims to the various royalty pools. The Licensing Division
collected a total of $214,888,724.96 in royalty fees (almost 85 percent in
the form of electronic funds transfers through the automated Clearing House
of a Fedwire transfer), and distributed royalties in the amount of $172,284,737.60,
When we last reported to you in 1998, we stated that we had lost ground in
providing some essential copyright services, and observed that we had a significant
arrearage with registration in some cases taking between six and eight months.
We outline in part III of this statement what steps the Office is taking to
reduce this arrearage.
Our focus this year is on:
Progress in fulfilling legislative directives;
Implementation of new fees;
Improving our service by providing more timely registration of claims
and recordation of documents;
Making more information available to the public electronically;
Acquiring materials through mandatory deposit; and
Administration of compulsory licenses and CARP's.
I. Progress in Fulfilling Legislative Directives
During the period between October, 1998 and December 1999, Congress passed
five bills, some of them addressing separate acts, concerning copyright. Several
of these acts gave the Office major new responsibilities in developing and
implementing new procedures and regulations and conducting studies or reports
for Congress on critical and often controversial new and emerging areas of
copyright law. The Office finds itself faced with new and challenging legal
questions about webcasting, anticircumvention, and design protection for vessel
A. Overview of Certain Recently Enacted Legislation
Recently enacted legislation that has had a major impact on the Copyright
Office's workload includes:
The Digital Millennium Act (DMCA)
The DMCA allowed the United States to ratify two new international treaties.
It also confirms and clarifies the historic and vital role of the Copyright
Office by affirming in statutory language the Copyright Office's longstanding
role in copyright policy and international matters.
Title I of the DCMA added a new chapter 12 to title
17 United States Code, which among other things prohibits circumvention
of access control technologies employed by or on behalf of copyright owners
to protect their works. Specifically, new subsection 1201(a)(1)(A) provides,
inter alia, that "No person shall circumvent a technological measure
that effectively controls access to a work protected under this title."
Subparagraph (B) limits this prohibition. It provides that anticircumvention
"shall not apply to persons who are users of a copyrighted work which
is in a particular class of works, if such persons are, or are likely
to be in the succeeding 3-year period, adversely affected by virtue of
such prohibition in their ability to make noninfringing uses of that particular
class of works under this title" as determined in a rulemaking by
the Librarian of Congress acting upon my recommendation . This prohibition
on circumvention becomes effective two years after the date of enactment,
on October 28, 2000.
Title II of the DMCA limits certain online infringement
liability for Internet service providers. Specifically, subsection 512(c)
provides limitations on service provider liability with respect to material
residing, at the direction of a user, on a system or network that the
service provider controls or operates, if the conditions set forth in
subsection 512(c)(1) are satisfied.
Title V of the DMCA, establishes a new chapter 13 to title 17 which creates
sui generis protection for certain original designs of vessel
hulls and sets the terms, conditions, and limitations of design protection,
including the rights granted to the designer or owner of the design, mandatory
registration of designs with the Copyright Office, and enforcement of
rights. Protection for registered vessel hull designs lasts for a period
of ten years measured from the earlier of the date of registration with
the Copyright Office or the date on which the design is first made public,
and concludes at the end of the tenth calendar year. Unlike copyright
law where registration is not a prerequisite to protection, registration
of an otherwise eligible vessel hull design must be made with the Copyright
Office within two years of the design being made public. Failure to make
timely registration results in loss of protection. Notice must be attached
to a protected design, and while failure to attach proper notice does
not terminate protection, it does affect remedies in an infringement action.
The Sonny Bono Copyright Term Extension Act
This Act extends the term of copyright for most works to the life of the
author plus 70 years. It similarly extends for an additional 20 years the
terms of anonymous and pseudonymous works, works made for hire, and works
in their renewal terms.
It addresses concerns of libraries and researchers about
the unavailability, for 20 additional years, of works that are no longer
commercially available. A new exemption allowing libraries and archives
to use the works for preservation, scholarship, or research during the
last 20 years of the copyright term is embodied in section 108(h) of the
This same legislation also contained the "Fairness in Music Licensing
Act of 1998" which broadens existing exemptions to the public performance
right in broadcast music (sec.110(5) of title 17, United States Code)
for qualifying establishments, primarily restaurants, bars, and retail
businesses depending on their square footage or total number and size
of loudspeakers or audiovisual "devices," and provided the business
does not charge the customer to listen to the broadcast.
New Procedures and Regulations
The Copyright Office has aggressively undertaken these new responsibilities.
Our progress is discussed more fully below and the status of each responsibility
is illustrated on a separate chart.(1)
Anti-circumvention Rulemaking (Title I of DMCA)
The Librarian of Congress is required to make a determination as to whether
or not particular classes of works are to be exempted from the anti-circumvention
prohibition on access. This determination is to be made upon the recommendation
of the Register of Copyrights in a rulemaking proceeding. The determination
thus made will remain in effect during the succeeding three years. In making
her recommendation, the Register of Copyrights is to consult with the Assistant
Secretary for Communications and Information of the Department of Commerce
and report and comment on the Assistant Secretary's views. 17 U.S.C. § 1201(a)(1)(C).
The Office published a Notice of Inquiry seeking comments and held hearings
early this month in Washington, D.C. and last week at Stanford University
Law School in Palo Alto, California. Post hearing reply comment are due June
23, 2000. The Office will then evaluate and assess the evidence gathered.
Designation of Agent for Online Service Providers (Title II of the DMCA)
To take advantage of the Online Copyright Infringement Liability Limitation
Act, service providers must designate agents whom copyright owners may notify
if the owners believe their work is being infringed. The name and address
of the agent must be filed with the Copyright Office and also posted on the
service provider's website. Title II of the DMCA became effective on enactment;
consequently, the Office had to act immediately. It published interim regulations
on November 3, 1998, on an emergency basis, and stated that it would publish
a Notice of Proposed Rulemaking at a later date. 63 Fed. Reg. 59233. In later
meetings with the parties using the system, they indicated that the interim
system was operating effectively, and the Office has continued to operate
under these regulations. The Copyright Office maintains a list of the filings
which are accessible on its website. As of May 12, 2000, approximately 2,121
agents had been designated.
Vessel Hull Design Protection (Title V of DMCA)
Shortly after passage of the DMCA, the Copyright Office began establishing
the registration system for vessel hull designs. Recognizing the need for
immediate implementation (because enforcement of rights under the new chapter
13 requires first obtaining a registration), the Office quickly took steps
to establish a workable registration system. It established an internal task
force to determine what needed to be done. The Office also consulted with
representatives of the marine manufacturing industry, academics, and the Coast
Guard. A new registration form, Form D-VH, to be used for all applications
for registrations of vessel hull design was created and interim regulations
were published on July 7, 1999. 64 Fed. Reg. 36,576 (1999). We received our
first application for registration on July 29, 1999. So far the Office has
received 23 design claims and registered 21. Most of the 23 were submitted
after protection was made permanent on November 29, 1999.
Notice for Libraries and Archives (Copyright Extension Act)
While granting libraries and archives an exemption under § 108(h)(1), the
law makes it clear that a library or archive may not use a work under this
subsection if: (A) the work is subject to normal commercial exploitation;
(B) a copy or phonorecord of the work can be obtained at a reasonable price;
or (C) the copyright owner or its agent provides notice to the Copyright Office
in accordance with Copyright Office regulations that either of the conditions
set forth in (A) and (B) applies. The Copyright Office published interim regulations
with requests for comments on December 30, 1998. 63 FR. 71785. Comments were
due by February 15, 1999 and reply comments by April 1, 1999. The Office has
not yet published final comments; no notice has been recorded under the interim
Completion of Reports Requested in DMCA
Report on Copyright and Digital Distance Education
The DMCA required the Copyright Office to prepare a report for Congress on
the promotion of distance education through digital technologies, including
interactive digital networks. To assist the Office in analyzing the relevant
issues and in preparing its recommendations, on December 23, 1998, the Office
requested comments from all interested parties, including representatives
of copyright owners, nonprofit educational institutions, and nonprofit libraries
and archives (63 FR 71167). In addition, a series of three public hearings
were held in Washington, D.C. (January 26-27, 1999), Los Angeles, CA (February
10, 1999), and Chicago, IL (Feb 12, 1999). Over 175 individuals and interest
groups responded in writing or in person at the hearings.
The Copyright Office released its report on "Copyright and Digital Distance
Education" at a hearing of the Senate Judiciary Committee held on May
25, 1999. On June 24, 1999, this Subcommittee held its hearing on the report.
The report is available on the Office's website and through the Government
The Office made several recommendations including: (1) that section 110(2)
be updated to permit digital transmissions over computer networks; (2) elimination
of the physical classroom requirement permitting transmissions to students
officially enrolled in the course, regardless of their physical location;
(3) adding language that focuses more clearly on the concept of mediated instruction;
(4) adding safeguards to minimize the greater risks of uncontrolled copying
and distribution posed by digital transmission; (5) retaining the current
"nonprofit" requirement for education institutions seeking to invoke
the exemption; (6) adding a new provision to the Copyright Act to allow digital
distance education to take place asynchronously; and (7) expanding the categories
of works exempted from the performance right beyond the current coverage of
non-dramatic literary or musical works, adding other types of works but allowing
performances of only reasonable and limited portions. The Office further recommended
that Congress provide clarification of the fair use doctrine in legislative
history to confirm that the doctrine applies in the digital environment, and
to explain the function of fair use guidelines. No legislation has been introduced
implementing the Office's recommendations.
Report on Effects of Encryption Research
The DMCA also required the Copyright Office and the National Telecommunications
and Information Administration (NTIA) of the Department of Commerce to prepare
a report for Congress on the effects on encryption research of section 1201(g)
of title 17. Section 1201 establishes a prohibition on the act of circumventing
technological measures that effectively control access to a copyrighted work.
Subsection 1201(g) provides an exemption for this prohibition for certain
acts of encryption research. The prohibition is scheduled to go into effect
on October 28, 2000. The Office and NTIA solicited and received public comments.
This joint report has been sent to Congress. It is now available on both the
NTIA's and the Copyright Office's websites.
Report on Protection for the Designs of Vessel Hulls
The Office had been required to prepare a joint report with the Patent and
Trademark Office evaluating the effects of the Vessel Hull Design Protection
Act at one year and two year intervals after the effective date of this legislative.
The Copyright Office had completed a draft of the first report which was being
reviewed when Congress amended this Act on November 29, 1999, and rescinded
the requirement. Under this amendment the Act is no longer set to expire in
two years, and the Office is not to issue a report until November 1, 2003.
Report on Effects of Title I and Development of Electronic Commerce
Section 104 of the DMCA directs the Register of Copyrights and the Assistant
Secretary for Communications and Information of the Department of Commerce
to submit to the Congress no later than 24 months after the date of enactment
a report evaluating the effects of the amendments made by title I of the Act
and the development of electronic commerce and associated technology
on the operation of sections 109 and 117 of title 17, United
States Code, and the relationship between existing and emerging technology
and the operation of those sections.
A Notice of Inquiry initiating this study has been completed by the Office
and the Department of Commerce and should be published in the Federal Register
in the near future.
Conditions in Motion Picture Industry
The Comptroller General in consultation with the Register of Copyrights is
to study the conditions in the motion picture industry that gave rise to §
4001 and the impact of § 4001 on the motion picture industry. GAO has begun
its study. The Office has engaged in consultation with the GAO and expects
that these consultations will continue.
Ongoing Legislative Concerns
In its exhaustive review of title 17 in order to update the Copyright Office's
publication of this title in its Circular 92, the Office identified a number
of areas where amendments, most purely technical, should be made. It has forwarded
these amendments to the Senate and the House.
Ratification of two new international World Intellectual Property Organization
The DMCA allowed the United State to ratify both the WIPO Copyright Treaty
and the WIPO Performances and Phonograms Treaty. Both of these treaties known
as "the Internet Treaties," deal with significant digital issues.
The Copyright assisted the Congress and the Executive Branch in the efforts
necessary to implement and notify these treaties. The United States deposited
its instruments of ratification with the World Intellectual Property Organization
on September 14, 1999.
Dispute brought in World Trade Organization
Office staff provided technical assistance to the U.S. Trade
Representative in the defense of a claim against the United States brought
in the World Trade Organization by the European Union. The dispute concerned
section 110(5)(a) and (b) of the U.S. Copyright Act, which the European Union
alleged violated the U.S.'s international treaty obligations. Staff from the
Copyright Office assisted in drafting the written submissions to the Dispute
Settlement Body of the WTO, and participated in consultations and oral arguments
before the Dispute Resolution Panel on behalf of the United States. In May
of this year, the Panel issued a decision in the case, finding that section
110(5) subsection (a) of the U.S. Copyright Act was in compliance with all
of the U.S. obligations, but that subsection (b) violated certain provisions
of the TRIPs Agreement and the Berne Convention. The United States has two
months from the date of formal publication of the decision (which has not
yet occurred) to decide whether it will appeal the Panel's findings.
Law Enforcement Coordination Council
In September, 1999, President Clinton signed into law the Treasury/Postal
Appropriations Bill, which created the "National Intellectual Property
Law Enforcement Coordination Council ("NIPLECC"), which is comprised
of executive branch law enforcement agencies, as well as the Department of
Commerce's, International Trade Division, the Patent and Trademark Office,
the U.S. Trade Representative and the State Department. It is chaired by the
Patent and Trademark Office and the Justice Department. By statute, the NIPLECC
is required to consult with the Register of Copyrights on law enforcement
matters relating to copyrights and related matters. The Register and her staff
have been involved at all levels of the NIPLECC's development, including discussing
the appropriate scope of responsibility and action plan of the NIPLECC, drafting
proposals and participating in meetings of the principals.
Continued Effort to Advise and Train Others to Improve Copyright Protection
The Office continued to participate in many international activities including
the meeting of the Governing Bodies of the World Intellectual Property Organization
and that organization's meetings of the Standing Committee on Copyright and
Related Rights. In the Standing Committee discussion has focused on a new
treaty for performers of audiovisual works (screen actors) and on potential
new treaties for broadcasters and for producers of databases. Additionally,
the Office assisted the United States Trade Representative in its many bilateral
and multilateral activities.
The Office continued its program of international development cooperation
through its International Copyright Institute, by meeting with many foreign
delegations and high level officials and by participating in many programs
on copyright and related rights held in countries all over the world.
The International Copyright Institute and the World Intellectual Property
Organization's Worldwide Academy jointly hosted a "Worldwide Seminar
on Copyright and Related Rights" in Washington, D.C. for participants
from fifteen countries during the week of March 17-24, 1999. The objectives
of the program were to discuss current and future copyright protection and
to exchange experiences among the participants and U.S. experts. In particular
the seminar focused on the new WIPO Copyright Treaty and the WIPO Performances
and Phonograms Treaty, and the impact of new technology on the protection
and enforcement of copyrights. Experts from both government and the private
sector presented a series of talks on United States copyright law and practice.
In addition, participants presented reports on the state of intellectual property
protection in their countries.
The Office participated in WIPO seminars in Kazakhstan, Kyrgyzstan, Namibia,
Australia, and in New Delhi, Calcutta and Hyderabad, India; and in USAID and
Department of Commerce programs in Kyrgyzstan and Egypt.
The Office was also represented at the meeting of the Global Business Dialogue
in Paris where the Register commented on the Intellectual Property Draft Paper
and at the WIPO International Conference on Electronic Commerce and Intellectual
Property and at MIDEM.
II. Implementation of New Copyright Office Fees and Their
Impact on the Office
Implementation of New Fees
In July 1997, anticipating enactment of a new fee system, the Copyright Office
began the process of determining the costs of registering claims, recording
documents and providing related services. It hired two consulting firms with
expertise in cost accounting and the new Federal Managerial Coast Accounting
Standards and established a Copyright Office Fee Analysis Task Group.
As enacted by Congress, the new fee provisions contained specific directions
as to how the Copyright Office should adjust its fees. They were:
The Register shall conduct a study of the costs incurred by the Copyright
Office for the registration of claims, the recordation of documents, and
the provision of services. This study should also consider the timing
of any increase in fees and the authority to use such fees consistent
with the budget.
On the basis of the study, and subject to congressional approval, the
Register is authorized to fix fees to recover reasonable costs incurred
for the services provided plus a reasonable adjustment for inflation.
The fees should also be fair and equitable and give due consideration
to the objectives of the copyright system.
The Register must then submit a proposed fee schedule with the accompanying
economic analysis to Congress for its approval. The Register may institute
the new fees 120 days after the schedule is submitted to Congress unless
Congress enacts a law within the 120 day period stating that it does not
approve the schedule.
The Office contacted representatives of interested parties to invite them
to discuss the forthcoming fee increases and identify their members' concerns.
A number met with the Register; others submitted comments. The Office published
a Notice of Proposed Rulemaking (NOPR) with two or more possible fee schedules
and formally sought public input through a public hearing held on October
1, 1998, and a comment period. After considering the studies, the operational
and policy issues and the input from the public, on February 1, 1999, the
Register sent Congress a detailed analysis and proposed fee schedule. This
report explained why careful evaluation of all relevant data led the Office
to conclude that the basic registration fee could not be set to recover the
full cost of registering a work, if it is to be reasonable, fair, and equitable
and consider the objectives of the copyright system. It recommended recovery
of Copyright Office costs for most other services. After receiving the report,
Congress had 120 days to enact legislation rejecting the proposal, or the
fees could go into effect. No such legislation was enacted; therefore, the
Office published a new fee schedule on June 1, 1999, which went into effect
July 1, 1999.(2) The Office announced that
this fee schedule would remain in effect for at least three years.
Operational Impact of the New Fee Schedule
As detailed fully in the Office's Annual Report for 1999, the Office made
significant efforts to inform the public of the fee change. Despite these
efforts, 90 percent of the cash receipts received in the first week after
the new fees went into effect contained insufficient funds. This percentage
was reduced to about 50 percent by the end of the fiscal year. Currently,
almost a year after the new fees went into effect, almost 15 percent of cash
receipts are still insufficient.
Relationship to Copyright Office Appropriation
The Copyright Office collects fees for registration of copyright, recordation
of documents and other services. Since fiscal year 1998 the Office has used
its authority to earn interest on its Deposit Accounts( prepaid fees), which
is deposited into a no year account. These funds are available to fund authorized
activities within the level of appropriation. Effective July 1, 1999, the
Office increased the cost of filing a basic registration from $20 to $30.
In fiscal year 1999, the Office collected $16,699,846 in copyright fees.
The fees earned by the Copyright Office are deposited in a Copyright Office
account in the U.S. Treasury. Earned fees are included when determining the
level of appropriations for the Copyright Office. In fiscal year 1999, the
Copyright Office received $34,891,000 in direct appropriations and authority
to spend receipts. For fiscal year 2000 this level is $37,485,014. This appropriation
supports 478 permanent staff and 23 temporary employees.
III. Improving Our Service by Providing More Timely Registration of Claims
and Recordation of Documents
As noted above, the Copyright Office continues to experience serious processing
arrearages, particularly in the Examining and Cataloging Divisions. The Office
has developed and initiated a plan to streamline its registration and recordation
processes through business process re-engineering. Further development of
the Copyright Office Electronic Registration, Recordation and Deposit System
(CORDS) will also help. In the short term, the Office has used overtime and
hiring of temporaries to reduce arrearages in its examining and cataloguing
divisions in order to expedite the registration of copyright claims and recordation
of transfers and other documents pertaining to copyright. More importantly
it is in the process of hiring new permanent staff in those areas. Such action
is critical to further reduction.
Business Process Re-engineering of Copyright Office Registration and Recordation
In fiscal year 2000, the Copyright Office initiated plans to re-engineer
its processes. Authors, other copyright owners, users of copyrighted works,
copyright industries, libraries, and members of the public rely on the Office's
records of registered claims in copyrighted works and recorded documents concerning
ownership of works. The value of the records is greatest
when up-to-date information on new works is available to the public in a timely
manner. Copyright owners also need timely issuance of certificates.
Re-engineering will accomplish the following objectives:
Improve operations and service to achieve better processing times and
create timely public records;
Improve response times to requests from the public;
Enhance operational efficiency through use of new technologies;
Contain costs of registration, recordation and other services;
Strengthen security within the Copyright Office; and
Use staff and space more efficiently.
The Copyright Office prepared a Request For Quote (RFQ), received bids, convened
an evaluation panel to rate them, and made a selection which has been submitted
to the Library's Office of Contracts and Logistics for negotiation. The firm
that is selected will provide for the Office a project plan, a baseline of
existing operations, an analysis of current workflow, alternative plans for
re-engineering of business processes, an implementation plan for the process
selected by the Office, and procedures manuals. A Project Manager, who is
an expert in Copyright Office procedures, will be responsible for working
with the contractor, Copyright Office managers, staff and labor organizations
during the study to coordinate the day-to-day implementation of the agreed-upon
Further Development of CORDS
There was noteworthy progress in the Office's major automation initiative,
CORDS, which enables electronic copyright registration and deposit of works
in digital form. The CORDS system facilitates copyright registration and deposit
process for online works by copyright claimants, helps the Copyright Office
streamline its internal registration processes, improves efficiency, through-
put time and internal security, and will provide the Library of Congress with
new copyrighted works in electronic form for its digital collections. Almost
15,000 claims were received and processed electronically through CORDS during
calendar year 1999. They were received from CORDS test partners: the University
of Phoenix (study guides), American Geophysical Union, American Mathematical
Society, and MIT Press/Journals Division (Ejournals), Adobe Systems (computer
programs) and American National Standards Institute (standards).
CORDS testing and implementation during the year focused on successful establishment
of system-to-system communications with the Office's largest copyright remitter
- UMI Company (recently renamed Bell and Howell Information and Learning corporation)
-- for electronic receipt and processing of claims for digital dissertations.
This was a significant CORDS milestone; there was fully automated processing--both
front-end preparation by claimants and full back-end electronic processing
by the Copyright Office, with complex interfaces to six other major systems.
In 1999, the Corporation for National Research Initiatives (CNRI) continued
its research and development work on CORDS with support from the Copyright
Office and DARPA (Defense Advanced Research Projects Agency) which funds a
small part of the associated research to evaluate and refine the architectural
components that can be applied to digital libraries and any registry system.
In January of 1999, a three-year Extension of the Memorandum of Agreement
with DARPA was approved for continued CORDS research and development work
by CNRI during 1999-2001.
In the year 2000, the Copyright Office is initiating another major CORDS
partnership with the Harry Fox Agency, a subsidiary of the National Music
Publishers Association, for electronic claims and deposits of musical works
on behalf of music publishers. Other CORDS partnerships are being planned
and developed as well.
The Office is continuing to develop "Mixed CORDS," for receipt
of electronic claims with hard copy deposit; more than two dozen potential
test partners are eagerly awaiting test implementation of Mixed CORDS which
is scheduled for later this year.
IV. Improving Communication to the Public
In fiscal year 1999, Copyright Office staff handled over 426,800 requests
for information. The Office is continuing to implement a number of improvements
to enhance public service including making more information available electronically.
These improvements move the Office forward to a future that will permit instant
access to its records and informational material and reduce distribution of
paper copies. The Office also increased its acceptance of Electronic Fund
A good example of the Office's electronic communication is seen in the way
the Licensing Division and the General Counsel's Office responded to inquiries
regarding various aspects of the Satellite Home Viewer Act in anticipation
of satellite carriers "shutting off" satellite service of network
stations to subscribers as a result of an injunction. The federal order required
satellite carriers to drop certain network signals received by nearly 1.5
million subscriber by October 8, 1998.(3)
A "hotline" for callers was established to obtain a copy of the
Copyright Office's Satellite Network Television factsheet. The factsheet was
made available via the internet, FAX-on-demand, or by mail. This approach
provided immediate information to the public, utilized staff in an efficient
and effective manner, and was widely publicized in trade publications. A
similar method was used upon passage of the Satellite Carrier Improvement
Improvement in Communication with the Public
Website. The Copyright Office's website played an increasingly
important role in the dissemination of information to the copyright community
and the general public. During the year, the website was redesigned to
enable faster and easier information retrieval by users. Selected as one
of the nation's top websites by PCNovice/Smart Computing magazine,
the website had over 5.6 million hits during the year, almost a threefold
increase over the prior year. The website continued to expand and provide
the public with electronic access to all publications. A major improvement
is the providing of all the application forms electronically as a fill-in
version to enable the public to complete their applications directly on
their PC terminals. More records were made available electronically to
the public with the inclusion of the Vessel Hull Design registrations
and the On-line Service Providers directory of designated agents. In an
effort to provide wider public participation in and dissemination of Copyright
Office studies and rule makings, the Office solicited and posted comments
from the public on the website for public viewing, as well as find studies
and regulation, e.g., the distant education study, and the rule
making on exemptions from prohibition on circumvention of technological
measures that control access to copyrighted works. The Office is also
posting streaming audios of its public hearing in the anti-circumvention
rulemaking, pursuant to 17 U.S.C. § 1201(a)(1).
NewsNet. In November of 1997, the Office developed NewsNet,
an electronic publication, distributed via the Internet. NewsNet
issues periodic e-mail messages to alert subscribers to hearings, deadlines
for comments, new and proposed regulations, new publications and other
copyright-related subjects of interest. The Office has a solid readership
of over 4,000 subscribers to NewsNet, and it published 41 issues
in fiscal year 1999.
E-mail. E-mail information requests increased by 25 percent over
the last fiscal year to [10,405.] In addition to the Public Information
Office, the Licensing Division and two additional offices that deal directly
with the public, the Reference and Bibliography Section and the Certifications
and Documents Section of the Information and Reference Division began
responding to public e-mail inquiries.
Fax on demand. Through its automated Fax-on-demand system the
Copyright Office continues to provide to the public via fax copies of
various Copyright Office publications, with over 4,500 requests annually.
Circular 92. In April the Office published a revision of circular
92, "Copyright Law of the United States of America and Related Laws
Contained in Title 17 of the United States Code." With this revision,
circular 92 is now a completed up to date edition of all of title 17.
It is available online at the Copyright Office's website and in print
through the Government Printing Office.
V. Acquiring Materials Received through Mandatory Deposit
The Copyright Office is a service unit within the Library of Congress and
works with the Library in fulfilling the Library's mission of service to Congress
and the American people. The Copyright Acquisition Division (CAD) staff works
very closely with the service units of the Library to acquire copyrighted
materials that have not been deposited through voluntary registration through
the mandatory deposit requirement, 17 U.S.C. § 407. Section 407 is an invaluable
avenue for the Library to acquire needed and often expensive resources. CAD
librarians communicate with more than 100 Recommending Officers to identify
those works to be acquired via the mandatory deposit requirement.
During fiscal year 1999, the Copyright Office transferred to the Library
an additional 349,713 pieces with an estimated value of $6,097,550, received
from publishers under the mandatory deposit provisions of the Copyright Act.
VI. Overseeing the Compulsory Licenses and CARP Proceedings
The Copyright Office continues to be involved with the administration of
seven CARP proceedings. Three of the seven proceedings involve setting rates
and terms for the cable compulsory license, 17 U.S.C. 111; the mechanical
license, 17 U.S.C. 115; the digital performance right in sound recordings
license, 17 U.S.C. 114, and the ephemeral recording license, 17 U.S.C.
112. The other three proceedings deal with the distribution of royalty fees
collected in accordance with the Satellite Home Viewer Act of 1994, 17 U.S.C.
119, the Audio Home Recording Act of 1992, 17 U.S.C. chap. 10, and the cable
compulsory license, 17 U.S.C. 111.
The proceeding to set rates for digital phonorecord deliveries (DPDs) and
"incidental" DPDs under section 115 began in 1996 with the announcement
of the voluntary negotiation period. With the assistance of the Office, certain
parties with an interest in setting these rates reached a settlement agreement
setting the rates and terms for DPDs but deferred until the next scheduled
proceeding further consideration of the rate for an incidental DPD. On February
9, 1999, the parties' rates and terms were adopted in final regulations after
the required notice and comment proceeding. The rates and terms announced
on February 9, 1999, are effective through December 31, 2000.
On July 20, 1999, the Office announced the voluntary negotiation period for
the next proceeding to adjust the rates and terms for the digital component
of the section 115 license. The negotiation period ran from the date
of publication of the announcement in the Federal Register to December 31,
1999. On January 24, 2000, Capital Bridge Co. Ltd. filed with the Copyright
Office a petition to convene a CARP to set new rates and terms for DPDs and
incidental DPDs. Later this year, the Copyright Office will publish a notice
in the Federal Register seeking comment on whether Capital Bridge Co. Ltd.
qualifies as a party with a significant interest in setting the applicable
rates and terms and requiring all interested parties to file their notice
of intention to participate in a rate adjustment proceeding.
The Copyright Office has also begun another rate adjustment proceeding to
establish rates and terms for the public performance of sound recordings by
means of eligible nonsubscription transmissions (the section 114 license as
amended by the Digital Millennium Copyright Act) and the making of ephemeral
recordings in furtherance of the permitted public performance of sound recordings
(the section 112 license) for the period 1998-2000. The Copyright Office announced
the six-month voluntary negotiation periods associated with these licenses
on November 27, 1998. The voluntary negotiation period concluded with no proposed
settlement being filed with the Copyright Office.
Consequently, the Office announced the schedule for the arbitration proceeding
to set the rates and terms for these two statutory licenses on September 27,
1999. The Office vacated the schedule announced in the Federal Register at
the request of the parties in order to allow more time to negotiate a settlement.
The Office was about to announce the schedule for the CARP proceedings to
set rates and terms for the 1998-2000 time period when, on March 1, 2000,
the Recording Industry Association of America (RIAA) filed a petition for
rulemaking with the Office asking that the Office determine the scope of the
section 114(d)(1)(A) exemptions; specifically, asking the Office to adopt
a rule "clarifying that a broadcaster's transmissions of its AM or FM
radio station over the Internet. . . is not exempt from copyright liability
under section 114(d)(1)(A)." In response, the Office published a Notice
of Proposed Rulemaking in the Federal Register on March 16, 2000, requiring
initial comments to be filed by April 17, 2000, and reply comments to be filed
by May 1, 2000. The Office has decided to defer setting a schedule for
the current CARP proceeding and to defer ruling on the motion to consolidate
until the rulemaking proceeding has been completed, probably within the next
several weeks. On May 23, 2000, the Office published a Notice of Inquiry in
response to a petition filed by the Digital Media Association seeking clarification
of the exclusion of "interactive services" from the section 114
Pursuant to 17 U.S.C. §§ 112(e)(7), 114(f)(2)(C)(i)(II), the Office announced
the initiation of the voluntary negotiation period for determining reasonable
rates and terms for the amended section 114 and section 112 licenses for the
time period 2001-2002. The negotiation period began on January 13, 2000. If
the parties are unable to reach a settlement, any party with a significant
interest in establishing reasonable terms and rates for these licenses may
file with the Office, during a sixty-day period beginning on July 1, 2000,
a petition to initiate a CARP.
In January 2000, the Joint Sports Claimants and the Program Suppliers filed
petitions asking the Office to commence a cable rate adjustment proceeding.
On February 28, 2000, the Office published a notice in the Federal Register
seeking comment on the two petitions and requesting that all interested parties
file a notice of intent to participate in the rate adjustment proceeding.
Several parties filed such notices on April 6, 2000. Later this year, the
Office will set a schedule for the proceeding.
The Office also administered various phases of three different CARP proceedings
to determine the distribution of the royalty fees: 1) the distribution of
the 1992, 1993, 1994, and 1995 satellite royalty fees, Docket No. 97-1 CARP
SD 92-95(a); 2) the distribution of the 1995, 1996, 1997, and 1998 royalty
fees collected for the distribution of digital audio recording technology,
Docket No. 98-3 CARP DD 95-98(b); and 3) the distribution of the 1993, 1994,
1995, 1996, and 1997 cable royalty fees.
The specific distribution figures are as follows:
100% of the 1992-1995 satellite royalties, totalling $71,478,402.00 has
- Sound Recording Fund:
100% of the 1995-1997 DART Sound Recording royalties,
totalling $777,866.00, has been distributed.
98% of the 1998 DART Sound Recording royalties, totalling
$922,984.00, has been distributed.
- Musical Works Fund:
21% of the 1995 DART Musical Works royalties, totalling
$26,297.00, has been distributed.
100% of the 1996 DART Musical Works royalties, totalling
$220,587.00, has been distributed.
43% of the 1997 DART Musical Works royalties, totalling
$92,697.00, has been distributed.
84% of the 1998 DART Musical Works royalties, totalling
$453,395.00, has been distributed.
100% of the 1993-1996 cable royalties, totalling $756,605,110.00
has been distributed.
82% of the 1997 cable royalties, totalling $158,912,749.00
has been distributed.
There is much work going on at the Office. We have a talented and dedicated
staff, whose efforts I sincerely appreciate. I and the entire Copyright
Office deeply appreciate the tremendous support received from members of
this Subcommittee, and your exceptional staff. Without you, our tasks would
be much more difficult. Thank you for all of your assistance. We look forward
to working with you on the many important copyright issues the Congress
1. See App. I.
2. A chart showing new fees for basic services in comparison
with the old fees is attached as App. II.
All current fees can be found in our regulations. 37 CFR § 201.3 (1999).
3. This was later extended to January 1, 1999.