[Federal Register: March 20, 1997 (Volume 62, Number 54)]
[Notices]
[Page 13396-13400]
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LIBRARY OF CONGRESS
Copyright Office
[Docket No. 97-1]
Revision of the Cable and Satellite Carrier Compulsory Licenses;
Public Meetings
AGENCY: Copyright Office, Library of Congress.
ACTION: Notice of public meetings and request for comments.
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SUMMARY: The Copyright Office, at the request of the Chairman of the
Senate Judiciary Committee, is examining the copyright licensing of
broadcast retransmissions for the purpose of recommending legislative
changes to the Congress. The Office is announcing public meetings, and
identifying issues for discussion, for the purpose of taking testimony
from interested persons. This Notice describes the schedule and
structure for the public meetings.
DATES: Public meetings will be held from May 6, 1997, through May 9,
1997, in the CARP Hearing Room, LM 414, James Madison Memorial
Building, 101
[PLEASE NOTE: This document contains the following corrected
information which is not in the original Federal Register Notices.
DATES: Public meetings will be held from May 6, 1997, through May 9,
1997, at the Postal Rate Commission, 1333 H Street, N.W., Third Floor,
Washington, D.C.]
[[Page 13397]]
Independence Avenue, S.E., Washington, D.C. 20540.
TIMES: Each daily session will begin at 10 a.m. Persons wishing to
testify should notify the Copyright Office in writing no later than
close of business on April 15, 1997. Notices of intent to testify
should be addressed to William Roberts, Senior Attorney, and may be
sent by mail or by telefacsimile. The Office will notify each person
expressing an intention to testify of the expected date and time of
his/her testimony.
WRITTEN STATEMENTS AND REPLY COMMENTS: Each person wishing to testify
must submit a formal written statement of his/her testimony no later
than the close of business on April 18, 1997. Written statements will
also be accepted from parties who do not wish to testify. Summaries of
the formal written testimony, for purposes of oral testimony, may be
submitted on the date of testimony. In addition, interested parties may
submit written questions, for possible use by panel members of the
Copyright Office during the course of meetings, no later than close of
business on April 18, 1997.
After the close of the meetings, interested parties may submit
written reply comments to the testimony offered at the meetings,
including any proposed legislative amendments, no later than close of
business on June 3, 1997.
ADDRESSES: If delivered by hand, fifteen copies of written statements,
questions, and reply comments should be brought to: Office of the
General Counsel, Copyright Office, James Madison Memorial Building,
Room LM-403, First and Independence Avenue, S.E., Washington, D.C.
20540. If sent by mail, fifteen copies of written statements,
questions, and comments should be sent addressed to Nanette
Petruzzelli, Acting General Counsel, Copyright GCR, P.O. Box 70400,
Southwest Station, Washington, D.C. 20024.
FOR FURTHER INFORMATION CONTACT: Nanette Petruzzelli, Acting General
Counsel, or William Roberts, Senior Attorney for Compulsory Licenses.
Telephone (202) 707-8380. Telefax: (202) 707-8366.
SUPPLEMENTARY INFORMATION:
Background
On February 6, 1997, Senator Orrin Hatch, Chairman of the Committee
on the Judiciary, United States Senate, sent a letter to the Register
of Copyrights requesting the Copyright Office to conduct a global
review of the copyright licensing regimes governing the retransmission
of over-the-air broadcast signals. Senator Hatch requested the Office
to report its findings to the Committee by May 1, 1997, and to develop
policy options and legislative recommendations. The reporting date has
now been extended, at the request of the Office, to August 1, 1997.
In making his request, Senator Hatch identified several issues
regarding the copyright implications of broadcast retransmissions which
Warrant consideration. Specifically, these include extension of the
compulsory copyright license created by the Satellite Home Viewer Acts
of 1988 and 1994, and the disputes surrounding the implementation of
that compulsory license and the so-called ``white area'' restriction
for the retransmission of television network stations. Additionally,
Senator Hatch asked the Office to consider possible harmonization of
the cable and satellite carrier compulsory licenses of the Copyright
Act, and the extension of those licenses to new technologies such as
local retransmission of broadcast signals by satellite, retransmission
of broadcast signals over the Internet and by the telephone companies,
and new markets for public television.
In discharging its task and making its report, Senator Hatch has
encouraged the Copyright Office to conduct open public meetings to hear
from interested parties and promote discussion in the hopes of
establishing consensus solutions to these issues. Consequently, the
Office is publishing this Notice to inform interested parties of the
time and structure of such meetings, and how the Office plans to
accomplish its task of reporting to the Senate Judiciary Committee.
Public Meetings
Because both the cable and satellite carrier compulsory licenses
implicate and affect the existence and profitability of a number of
industries, the Copyright Office believes that input from these
affected industries is critical to a complete report to the Congress.
Consequently, the Office has determined that a process involving both
written comments and open meetings is essential to gathering the
necessary information. We are, therefore, announcing the following
schedule.
The Office will conduct public meetings with interested parties in the
CARP Hearing Room at the Copyright Office beginning on May 6, 1997,
and running through the end of that week, if necessary.
[PLEASE NOTE: This document contains the following corrected
information which is not in the original Federal Register Notices.
The Office will conduct public meetings with interested parties
at the Postal Rate Commission, 1333 H Street, N.W., Third Floor,
Washington, D.C. beginning on May 6, 1997, and running through the
end of that week, if necessary.]
The format for these meetings will resemble the traditional Congressional
hearing model in that there will be panels of witnesses that will present
testimony to a panel of Copyright Office staff, headed by the Register
of Copyrights. The Register and Office staff will ask questions of the
various persons who testify, and interested parties may submit written
questions to the Office by April 18, 1997, which may be addressed to
specific witnesses, or the witnesses as a whole. There are no
guarantees that the Office will ask every written question that is
submitted.
The public meetings are open to anyone. However, in order to
testify, interested persons must inform the Office of their intention
to testify no later than the close of business on April 15, 1997.
Notification of intention to testify must be in written form, either by
letter or notice, and must be in the possession of the Office by the
close of business on April 15. Because of time constraints, and the
need for the Office to schedule the panels of witnesses as soon as
possible, it is recommended that persons wishing to testify deliver
their notification by hand or facsimile transmission by the deadline.
Notifications received after the April 15 deadline will not be
accepted, and such person or persons will not be allowed to testify.
The public meetings will begin at 10 a.m. each morning, and will
continue until 5 p.m., unless otherwise directed by the Register of
Copyrights. The Office will notify each witness who has filed a timely
notice of intention to testify several days in advance of the date he/
she is expected to appear and offer testimony. The Office will also
notify each witness of the other witnesses who will appear on his/her
panel. Because of space limitations in the CARP Hearing Room, witnesses
are encouraged to appear only on the date they are scheduled to offer
testimony.
Witnesses may bring with them on the day of their testimony a
written summary of their oral testimony. Witnesses who bring such
written summaries are asked to provide fifteen copies of the written
summaries for use by the Office and others in attendance at the
meeting.
Transcription services of the public meetings will be provided by
the Copyright Office. Those parties interested in obtaining transcripts
of the meetings will need to purchase them from the transcription
service.
Written Statements
All persons who notify the Copyright Office of their intention to
testify must submit a written statement of their testimony by the April
18, 1997, deadline. Because of time limitations, the Office encourages
parties submitting written statements to deliver them to the
[[Page 13398]]
Office by hand or by overnight express mail on or before the April 18
deadline. Telefacsimile transmissions of written statements will not be
accepted.
Parties submitting written statements are encouraged to include any
and all information that they consider relevant to the copyright
licensing of broadcast retransmissions. Parties may also include any
exhibits that they deem relevant. Fifteen copies of each written
statement must be submitted by the deadline.
There is no prescribed format for the written statements. Parties
are encouraged to organize their testimony in as clear and readable
form as possible, and to provide a glossary of technical terms used in
the written statement.
Parties who do not wish to appear at the public meetings are
nonetheless permitted, and encouraged, to submit written statements by
the April 18 deadline.
Reply Comments
After the close of the public meetings, interested parties may
submit comments in reply to the written statements and oral testimony.
The reply phase is open to all parties, and is not limited to those who
testified at the meetings and/or submitted written statements. As with
the written statements, reply comments must be in the possession of the
Copyright Office by the June 3, 1997, deadline. No facsimile
transmissions of reply comments will be accepted.
There is no format for reply comments, beyond the principles of
clarity and a glossary of technical terms. Parties are also encouraged
to offer any legislative proposals and/or amendments that they have at
that time.
Scope of the Proceeding
As Senator Hatch's letter makes clear, the Copyright Office will be
conducting a global review of copyright licensing for the
retransmission of broadcast signals, and in particular the cable and
satellite carrier compulsory licenses. The Office will be confining its
report to issues related to the retransmission of over-the-air
broadcast signals. The Office will not be considering other matters,
such as music licensing for television, the section 114 compulsory
license for digital subscription transmission services, operation or
administration of the Copyright Arbitration Royalty Panels, or matters
of copyright liability for on-line service providers on the Internet.
While the Office's report is confined to the retransmission of
broadcast signals, this does not mean that the Office will focus solely
on the cable and satellite carrier compulsory licenses as they
currently exist. Rather, all matters involving copyright licensing of
broadcast retransmissions will be considered, including basic questions
such as whether there remains a need for compulsory licenses or whether
new compulsory licenses should be added to the Copyright Act. More
specifically, are compulsory licenses still justified? Perpetually? Or,
can they be phased out? If compulsory licenses all justified, are the
present configuration and present provisions fair and equitable? Or,
should adjustments be made? If so, what should the changes be? Should
the existing licenses be combined into one new license? Should new uses
or services be combined in it? Or, should new uses and services be
subject to separate and distinct licenses?
In filing their written statements and offering oral testimony, the
parties are encouraged to address any and all matters related to
copyright licensing of broadcast retransmissions which they believe are
relevant and important. In order to identify as many issues as possible
from the outset, so as to permit full discussion, the Copyright Office
met informally with representatives of the major industries affected by
copyright licensing of broadcast retransmissions. Representatives
included copyright owners of broadcast programming, cable and satellite
carriers, broadcasters, the Public Broadcasting Service, and telephone
companies. The purpose of these meetings was not to discuss policy or
what the law should look like, but to identify the relevant issues.
The Office welcomes discussion of any matters related to copyright
licensing of broadcast retransmissions that interested parties deem
important. The Office is, however, raising a number of issues below,
identified during the course of its informal meetings, which we believe
deserve attention during the course of the public meetings. We
encourage interested parties to provide any and all information and
opinions regarding these issues in both their written statements and
oral testimony.
A. Basic Principles
1. Need for compulsory licenses. As noted above, the fundamental
principles of copyright licensing of broadcast retransmissions are part
of this review. The cable industry has enjoyed a compulsory license for
its broadcast retransmission since January 1, 1978, and the satellite
industry has had a similar license since 1988. Do the conditions that
warranted creation of those licenses continue, or have circumstances
changed such that the need and/or configuration of those licenses
should be altered? Is there a continuing need for the cable and
satellite licenses, or should cable and/or satellite carriers be
required to negotiate the licensing of broadcast programming in the
free marketplace?
2. Expansion and revision of compulsory licenses. In the
alternative, should the compulsory licensing scheme of the Copyright
Act be expanded? Should new types of broadcast retransmission services,
such as open video systems provided by telephone companies and
retransmission services via the Internet, have their own separate
compulsory licenses? Or, is it better to place these services in the
existing compulsory license structure? How could this be achieved?
Furthermore, assuming that a compulsory licensing scheme should
remain for broadcast retransmissions, should the cable and satellite
licenses be unified into a single compulsory license applicable to all
retransmissi
on providers? What are the practical barriers to such a
single license? What are the advantages and disadvantages?
If the cable and satellite carrier compulsory licenses remain
separate, should the royalty rates paid under both licenses be
equalized? Should this be done in the statute, or should the criteria
for adjusting royalty rates be made the same for both licenses? Should
the standard be the fair market value of the copyrighted works, or are
there other or additional criteria that should be used?
3. Must-carry. An important element of the structure of the cable
compulsory license in 1976, and today, is the must-carry regulation of
broadcast signals by the Federal Communications Commission. Must-carry
regulation was reimposed by Congress in the 1992 Cable Act after it had
been eliminated by the courts in the mid-1980's, and the
constitutionality of the new must-carry regime is currently on appeal
to the United States Supreme Court. The Copyright Office is aware that
the outcome of that case has a direct impact on how broadcasters, and
copyright owners, view the copyright licensing of broadcast
retransmissions. Recognizing that the current appeal may not be the
final word on must-carry (the Supreme Court could, for instance, find
the concept of must carry to be constitutional but then find fault with
the current must-carry rules), what impact might the Court's decision
have on the current compulsory licensing scheme? If the Court upholds
must-carry, should must-carry be extended to the satellite carrier
compulsory license and the provision of local network
[[Page 13399]]
signals, as well as all other broadcast retransmission services seeking
compulsory licensing? If the Court strikes down must-carry in whole or
in part, as unconstitutional how should that affect a revised
compulsory license scheme for broadcast retransmissions?
B. Cable Compulsory License
1. Cable regulation and rates. The cable compulsory license,
created in 1976, represents a number of compromises and requirements
necessitated by the technological and regulatory framework in existence
at that time. Since 1976, the cable industry has grown considerably,
and the marketplace has changed. The license is based upon a regulatory
structure of the Federal Communications Commission that has not been in
existence for a number of years. Should the cable compulsory license be
reformed to reflect the current marketplace and regulatory framework?
Should the royalty payment scheme of the license, based upon each cable
system's gross receipts for the retransmission of broadcast signals, be
simplified so as to remove reliance upon outdated FCC rules? Is the per
subscriber, per signal charge of the satellite carrier license an
appropriate solution? If not, why not? Are there other solutions? Also,
should the payout of royalties collected under the cable license be
broadened to include compensation for network programming as well as
nonnetwork programming?
In addition to regulatory changes, the cable industry has
experienced considerable marketplace change. The FCC's examination of
the state of the cable industry in the last several years demonstrates
that the cable industry has become far more concentrated and
integrated. Should the cable compulsory license be amended to reflect
the significant amount of mergers and acquisitions in the cable
industry? If so, in what ways?
2. Radio retransmissions. Retransmission of broadcast signals under
the cable license includes both television and radio. The FCC is
beginning its process of authorizing over-the-air radio services. Does
the cable license need to be amended to accommodate retransmission of
these services, and should all broadcast retransmission services be
allowed to carry radio as well as television broadcast signals?
3. New retransmission providers. In recent years, a number of new
retransmission providers outside the ambit of traditional cable systems
have sought inclusion in the cable compulsory license. These have
included satellite carriers, wireless cable operators (which
successfully sought statutory inclusion in 1994) and telephone
companies providing broadcast retransmissions on video dialtone and
open video system platforms. Is it appropriate to include these
services, and other newcomers such a broadcast retransmissions via the
Internet, within the cable compulsory license? If so, does the license
require amendment to accommodate these operators, and in what fashion?
Does the passive carrier exemption of 17 U.S.C. 111(a)(3) require
amendment to accommodate these services? How can the cable license be
amended so that all users of the license are in parity with one another
in terms of the signals that they are permitted to provide and the
royalty amounts they pay for those signals? Should there be economic
and/or regulatory caps on the number of distant broadcast signals that
may be carried, or should all signals be paid for at the same rates?
Finally, should the existence of the cable compulsory license
continue in perpetuity, or should the license be phased-out after some
period of time? Or, in the alternative, should the license be made
periodic so that it is a subject to renewal every certain number of
years, such as the satellite carrier compulsory license?
C. Satellite Carrier Compulsory License
1. White area restriction. One of the major motivating factors for
requesting the Copyright Office to consider the compulsory licensing
scheme for broadcast retransmissions consists of certain problems that
have arisen in the operation of the satellite carrier compulsory
license. This is especially so since the license is slated to expire at
the end of 1999, and Congress will need to consider whether it should
be extended, and if so, under what conditions. Specifically, much of
the controversy has centered on the network territorial provisions of
the Satellite Home Viewer Act, commonly known as the ``white area''
restriction. The current satellite carrier license does not allow
satellite carriers to make use of the license for network signals for
subscribers who do not reside in unserved households. An ``unserved
household'' is defined as one that cannot receive a signal of grade B
intensity, using a conventional rooftop antenna, from the local network
affiliate, and has not received the local network affiliate through a
subscription to cable services within the previous ninety days.
Is the white area restriction of the satellite license still
necessary, or should satellite carriers be permitted to provide network
signals to all their subscribers? Should the white area restriction
remain in place for satellite carriers who wish to provide a subscriber
with a distant network affiliate, but not apply to satellite carriers
who provide retransmission of local network affiliates to their
subscribers? If so, how should a local network affiliate be defined?
Should a satellite carrier be permitted to provide retransmission of a
network affiliates to subscribers who reside within the Designated
Market Area of the affiliate, or is there a better way to determine
local area?
There are a number of other issues surrounding the white area
restriction. The purpose of the restriction is to allow network
broadcasters to preserve the exclusivity of their programming in their
market. Is it now possible, and appropriate, to impose exclusivity
protection upon satellite carriers through FCC regulation (syndicated
exclusivity and network non-duplication) rather than through the
copyright statute? If the white area restriction remains, is the grade
B signal intensity still an appropriate measure? Should another
standard be adopted, such as picture quality? If picture quality is
appropriate, how can that be enforced as a legal standard for
determining copyright infringement? How can subscribers who cannot have
a conventional rooftop antenna receive network signals from their
satellite carrier? Likewise, can persons who reside and travel in
mobile homes receive network service? What is the justification for the
90 day waiting period from any subscription to a cable system that
provides the signal of a primary network station affiliated with that
network, and should that provision be eliminated from the statute?
A possible solution to difficulties surrounding the white area
provision is an adjustment in royalty rates designed to compensate
local network affiliate broadcasters for the loss of viewership to
distant network signals. In essence, subscribers who reside within the
service area of a network affiliate, and desire to receive the signal
of a distant network affiliate, can pay a surcharge for the privilege
of receiving that distant network affiliate. The monies generated by
the surcharge would be paid to the network affiliates. Is this a viable
option and, if so, how should the surcharge monies be collected and who
should administer their payment?
[[Page 13400]]
Finally, with respect to satellite subscribers who have their
service of network signals disconnected due to the white area
restriction, what means of redress can they be afforded to determine
that termination of their service was accurate and required? Can the
subscriber require that either the satellite carrier terminating
service, or the network affiliate challenging service, conduct a test
at his/her household to determine if he/she is eligible for network
service? Who should pay for such test and how should it be
administered? What should be the appropriate standards of the test? If
a test is created, should subscribers who currently receive network
signals be grandfathered in their receipt of those signals? Should the
matter of a subscriber's eligibility to receive network service from a
satellite carrier be a matter of private determination between
broadcasters and satellite carriers, or should a government agency make
the determination?
Another area of recent interest is the enforcement of the white
area restriction. If such a restriction continues, how can it be more
economically and efficiently enforced? Are there better ways to
identify which subscribers may receive network signals under the
satellite license, and those who are not eligible? Should the remedies
for copyright infringement be amended to provide for additional and/or
different remedies for violations of the white area restriction?
2. Other issues. Aside from the white area restriction, other areas
of the satellite carrier compulsory license warrant consideration.
Network signals are currently paid for at a lower royalty rate than
superstation signals. Should the disparity be eliminated, so that all
signals are paid for at the same rate? Should there be special
provision for retransmission or transmission of a national satellite
feed of the Public Broadcasting Service, and a separate royalty rate
for this signal? What should the rate or rates be?
The satellite carrier license will expire at the end of 1999.
Should the license be extended on a permanent basis, or is temporary
extension still an appropriate solution? If an extension is temporary,
what mechanisms can be put into place to encourage a smooth and
efficient transition into a free marketplace system? Is collective
administration of copyrighted broadcast programming an appropriate
solution, and, if so, who should administer such a system?
The Copyright Office welcomes and encourages response and
discussion of these issues, as well as any other related matters
interested parties deem relevant and important.
Dated: March 17, 1997.
Marybeth Peters,
Register of Copyrights.
[FR Doc. 97-7091 Filed 3-17-97; 2:51 pm]
***4/22/97***
Corrected version 5/1/97