Page:H.R. Rep. No. 94-1476 (1976) Page 366.djvu

 among the public solely on the basis of the kind of television reception device used (a master antenna of a CATV system or a conventional rooftop individual antenna).

The basic concept of this proposed legislation is to impose copyright liability only for the privilege of receiving and for the reception of “distant” signals. This concept implements the fundamental proposition that no copyright liability should attach for the reception and secondary transmission of “local” signals. Accordingly, every cable television system would pay a percentage of its gross revenue from basic cable television services as a copyright fee.

However, as most Members will agree, once the payment for the privilege of receiving “distant” signals is accepted by cable television, the issue becomes then which signals are distant and what will be paid by a cable television system receiving and re-transmitting those signals to its subscribers.

“Local” signals, under the Federal Communications Commission’s Rules, have four different meanings depending on the size of the television market or local of the CATV system outside all television markets. These various definitions have no relationship to actual reception of signals directly off-the-air.

It is also worthy of note that the definitions of stations which are entitled to have their signals transmitted have been changed by the Federal Communications Commission from time to time and will almost certainly be changed again; whereas the Commission’s definition as of April 15, 1976 governs under the bill.

Further, it is well established that in many areas of the country many more television signals are available directly off-the-air than the “local” signals as defined by the FCC rules. Thus, it is clear that the Commission’s Rules on “local,” or “must carry,” signals are not based on signals that can be received directly off-the-air but rather are designed for communications policy and other administrative goals.

These goals concern such matters as the exclusivity or nonduplication of signals in accordance with priorities assigned according to signal strength. The adoption in this bill of the FCC definition in defining “local service area of a primary transmitter” is arbitrary; it does not take into account what signals actually may be received directly off-the-air; and consequently ought not to be incorporated in this legislation.

The conversion of the FCC Rules permitting television stations to insist on carriage into a definition of a local service area of a primary transmitter will result in signals receivable off-the-air being arbitrarily treated as distant signals, with copyright liability contrary to the stated concept of the bill.

Further, the greatest impact for copyright payment would seem to fall on the very systems which were developed to provide satisfactory television reception service. They will pay three to four times the .00675 charge and as high as 3 percent for so-called distant signals which are locally available and received directly off-the-air.

In my judgment, this bill should more realistically define a local and distant signal solely on the basis of whether it may be received directly off-the-air. Definitions and language similar to that used in treating the foreign broadcast stations in Section 111(c)(4) in terms of a distance limitation of 150 miles or of the “direct interception of a free