Copyright Office Urged to Oppose Compulsory Licenses for Web Sites
The Copyright Office should push Congress not to give Web sites freedom to stream broadcast TV shows under compulsory licensing laws, several content providers said in comments to the office. Disney, professional sports leagues, the Motion Picture Association of America (MPAA) and a group whose members said they license music from nearly every published songwriter said the Office should not recommend lawmakers apply to Web sites the Copyright Act compulsory license provisions that let cable and satellite operators carry those signals without contracts with each copyright owner (CD July 5 p7).
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Several players said it may make sense to apply the compulsory copyright rules to Internet Protocol TV (IPTV). AT&T needs such protection to compete with cable, it said. “The benefits of the statutory license have been enduring” since taking effect in 1976, the company said. Verizon said new video entrants “depend” on cable statutory licenses “to compete with more established cable operators.”
Cable and satellite differ from webcasters because pay- TV firms send copyrighted works to limited numbers of American subscribers and the Internet has few distribution limits, MPAA and other filers said. Sections 111 and 119 of the Act, which give cable and satellite blanket copyright permission, ensure that licenses are “respected,” MPAA Executive Vice President Fritz Attaway plans to tell the Office at public hearings July 23-25 on a notice of inquiry it opened last year. MPAA filed Attaway’s testimony in advance. Internet programming is another matter because it allows content to be distributed instantly, worldwide, Attaway said, urging that the matter be negotiated directly between Web sites and copyright owners. “Open Internet transmission would decimate the value of broadcast programming,” he said. Internet compulsory licenses “involve the potential loss of the programming’s value from the capability on open Internet to make perfect and infinite numbers of copies that can be delivered on a worldwide basis,” he said. The same hearing will hear opposition to online expansion of compulsory licenses from a group calling itself Joint Sports Claimants and representing the NBA, NFL, NHL and the baseball commissioner.
An IPTV exemption may make sense, said Disney and MPAA. The Copyright Office must extend copyright safeguards to IPTV if it recommends compulsory licenses for service providers, they said. And the Office must recommend banning free redistribution of copyrighted programs initially sent by IPTV, Attaway will testify. If covered by the compulsory license provisions, IPTV would have to follow retransmission consent, syndicated exclusivity, network nonduplication, must-carry and other rules that govern cable and satellite companies, Disney Executive Vice President Preston Padden will say: “There may be an important distinction between the use of Internet Protocol-based technology to deliver a signal from a central facility over a truly closed network in a defined and limited geographic area -- as cable systems do -- and the use of the public Internet to retransmit broadcast signals.”
The government should keep out of deals between webcasters and programmers, said Disney, MPAA and a group of music licensee fee collectors. The musical performing rights societies said sites easily get content without compulsory licenses, citing online video from cable networks, TV stations, wireless carriers, iTunes and Vongo. Program access complaints with the FCC from a startup streamer, Virtual Digital Cable, have “no bearing” on compulsory licenses, said BMI, SESAC and the American Society of Composers, Authors and Publishers. Most online video has already aired on cable, satellite or broadcast TV, they said, and Internet content distributors make deals for specific programs, not for an entire network’s output, the group said. “Internet sites do not have clear rights to all programming on a signal, as did cable operators and satellite carriers,” it said. “Given the global reach of the Internet, it is difficult to imagine how to apply the concepts of ‘distant signal’ and/or ‘unserved household’ to users who receive transmissions online.”
Licenses for distant signals are crucial to serving satellite customers in smaller markets with few TV stations and those living beyond local signal coverage, a DirecTV representative will tell the hearing. “If anything, Congress ought to make it easier for satellite carriers to serve these two classes of consumers,” lawyer Michael Nilsson, representing the company, will testify. He touted a bill (HR-2821) by Rep. Mike Ross, D-Ark., that would make it easier for satellite providers to carry distant signals.
Beyond criticizing the idea of giving websites compulsory licenses, some filers said neither cable nor satellite needs such licenses. They simply could negotiate directly with copyright owners, Padden will testify: “This happens every day with cable networks.” The current system leads to “market distortion,” he will testify, citing comments by the MPAA and Joint Sports Claimants. Pay-TV providers pay too little in compulsory license fees, said the music royalty filers. They cited cable revenue’s growth from $770 million in 1976, when the Act was passed, to 2006’s $69.5 billion. “The size and maturity of the cable and satellite industries obviates any further need for government subsidization,” the group said.