Page:H.R. Rep. No. 94-1476 (1976) Page 092.djvu

 the mere placing of an ordinary radio or television set in a private hotel room does not constitute an infringement. Secondary transmissions of instructional broadcasts

Clause (2) of is intended to make clear that an instructional transmission within the scope of section 110(2) is exempt whether it is a “primary transmission” or a “secondary transmission.”

Carriers

The general exemption under section 111 extends to secondary transmitters that act solely as passive carriers. Under clause (3), a carrier is exempt if it “has no direct or indirect control over the content or selection of the primary transmission or over the particular recipients of the secondary transmission.” For this purpose its activities must “consist solely of providing wires, cables, or other communications channels for the use of others.”

Clause (4) would exempt the activities of secondary transmitters that operate on a completely nonprofit basis. The operations of nonprofit “translators” or “boosters,” which do nothing more than amplify broadcast signals and retransmit them to everyone in an area for free reception, would be exempt if there is no “purpose of director indirect commercial advantage,” and if there is no charge to the recipients “other than assessments necessary to defray the actual and reasonable costs, of maintaining and operating the secondary transmission service.” This exemption does not apply to a cable television system.

Secondary transmissions of primary transmissions to controlled group

Notwithstanding the provisions of subsections (a) and (c), the secondary transmission to the public of a primary transmission embodying a performance or display is actionable as an act of infringement if the primary transmission is not made for reception by the public at large but is controlled and limited to reception by particular members of the public. Examples of transmissions not intended for the general public are background music services such as MUZAK, closed circuit broadcasts to theatres, pay television (STV) or pay-cable.

The Senate bill contains a provision, however, stating that the secondary transmission does not constitute an act of infringement if the carriage of the signals comprising the secondary transmission is required under the rules and regulations of the FCC. The exclusive purpose of this provision is to exempt a cable system from copyright liability if the FCC should require cable systems to carry to their subscribers a “scrambled” pay signal of a subscription television station.

The Committee is concerned, however, that the Senate bill is not clearly limited to the situation where a cable system is required by the FCC to carry a “scrambled” pay television signal. The Committee believes that the provision should not include any authority or permission to “unscramble” the signal. Further, the Senate bill does not make clear that the exception would not apply if the primary transmission is made by a cable system or cable system network transmitting its own originated program, e.g., pay-cable. For these reasons, the subsection was amended to provide that the exception would only apply if (1) the primary transmission to a controlled group is made by a broadcast station licensed by the FCC; (2) the carriage of the