Copyright Office, Library of Congress.
Notice of Inquiry.
The Copyright Office is seeking comment on copyright issues associated with the secondary transmission of digital television broadcast signals by cable operators under the Copyright Act.
Written comments are due November 6, 2006. Reply comments are due December 4, 2006. September 20, 2006.
If hand delivered by a private party, an original and five copies of a comment or reply comment should be brought to Library of Congress, U.S. Copyright Office, 2221 S. Clark Street, 11th Floor, Arlington, VA. 22202, between 8:30 a.m. and 5 p.m. The envelope should be addressed as follows: Office of the General Counsel, U.S. Copyright Office.
If delivered by a commercial courier, an original and five copies of a comment or reply comment must be delivered to the Congressional Courier Acceptance Site (“CCAS”) located at 2nd and D Streets, NE, Washington, D.C. between 8:30 a.m. and 4 p.m. The envelope should be addressed as follows: Office of the General Counsel, U.S. Copyright Office, LM 430, James Madison Building, 101 Independence Avenue, SE, Washington, DC. Please note that CCAS will not accept delivery by means of overnight delivery services such as Federal Express, United Parcel Service or DHL.
If sent by mail (including overnight delivery using U.S. Postal Service Express Mail), an original and five copies of a comment or reply comment should be addressed to U.S. Copyright Office, Copyright GC/I&R, P.O. Box 70400, Southwest Station, Washington, DC 20024.
Ben Golant, Senior Attorney, and Tanya M. Sandros, Associate General Counsel, Copyright GC/I&R, P.O. Box 70400, Southwest Station, Washington, DC 20024. Telephone: (202) 707–8380. Telefax: (202) 707–8366.
Section 111 of the Copyright Act (“Act”), title 17 of the United States Code (“Section 111”) provides cable systems with a statutory license to retransmit a performance or display of a work embodied in a primary transmission made by a television station licensed by the Federal Communications Commission (“FCC”). Cable systems that retransmit broadcast signals in accordance with the provisions governing the statutory license set forth in Section 111 are required to pay royalty fees to the Copyright Office. Payments made under the cable statutory license are remitted semi–annually to the Copyright Office which invests the royalties in United States Treasury securities pending distribution of these funds to those copyright owners who are entitled to receive a share of the fees.
The Motion Picture Association of America, Inc. (“MPAA”), its member companies and other producers and/or distributors of movies, series and specials broadcast by television stations (“Program Suppliers”) and the Office of the Commissioner of Baseball, the National Basketball Association, the National Football League, the National Collegiate Athletic Association, the National Hockey League and the Women's National Basketball Association (“Joint Sports Claimants” or “JSC”) (collectively, “Copyright Owners”) have requested that the Copyright Office commence a rulemaking to clarify the applicability of existing Copyright Office rules to the retransmission of digital broadcast signals under the statutory license set forth in Section 111 of the Copyright Act.
The regulatory actions requested by Copyright Owners are properly within the authority of the Copyright Office. 17 U.S.C.111(d) and 702. However, the retransmission of digital broadcast signals under Section 111 raises many issues, some of which require further elucidation before amending Section 201.17 of title 37 of the Code of Federal Regulations (“CFR” or “Section 201.17”) and the associated cable Statement of Account forms (“SOAs”). We therefore initiate this Notice of Inquiry (“NOI”) to address the matters raised by the Copyright Owners' Petition for Rulemaking
Digital television technology enables a television broadcast station to provide, over–the–air, an array of quality high–definition digital television signals (“HDTV”), standard–definition digital television signals (“SDTV”), and many different types of ancillary programming and data services. In 1997, the FCC adopted its initial rules governing the transition of the broadcast television industry from analog to digital technology,
It is this trend toward carriage of digital signals, often simultaneously with the transmission of an analog counterpart, that has prompted Copyright Owners to seek clarification of the rules governing a cable system's carriage of broadcast signals under Section 111. However, before proposing new rules, the Copyright Office seeks comment on the proposed changes and a number of associated issues related to the carriage of digital signals.
Copyright Owners request that the Copyright Office address the recordkeeping and royalty calculation issues that arise in connection with the carriage of digital broadcast signals by cable operators, provided that the Copyright Office is of the view that Section 111 covers retransmissions of digital broadcast signals. Petition at 5.
In 1976, Congress amended the Copyright Act by adding,
In structuring the license, Congress made a distinction between primary and secondary transmissions and local versus distant ones in order to identify which transmissions are subject to the statutory license and at what rate. It did not define a broadcast transmission or identify whether a transmission was subject to the statutory license on the basis of the signal's technical characteristics (
Specifically, Section 111(f) of the Act broadly defines “primary transmission” as “a transmission made to the public by the transmitting facility whose signals are being received and further transmitted by the secondary transmission service, regardless of where or when the performance or display was first transmitted,” and a “secondary transmission” as “the further transmitting of a primary transmission simultaneously with the primary transmission, or nonsimultaneously with the primary transmission [under a narrowly prescribed set of circumstances]...” It is these secondary retransmissions to the public, where the carriage of the signals comprising the secondary transmission is permissible under the rules, regulations, or authorizations of the FCC, which are subject to statutory licensing.
Such transmissions are then categorized as local or distant based upon the statutory definition of the “local service area of the primary transmitter,”which “in the case of a television broadcast station, comprises the area in which such station is entitled to insist upon its signal being retransmitted by a cable system pursuant to FCC requirements in effect on April 15, 1976, or such station's television market as defined in section 76.55(e) of the FCC's rules (as in effect on September 18, 1993), or any modifications to such television market made, on or after September 18, 1993, pursuant to sections 76.55(e) or 76.59 of the FCC's rules . . . .”
As seen above, there is nothing in the Act, its legislative history, or the Copyright Office's implementing rules, which limits the cable statutory license to analog broadcast signals. Instead, the cited provisions broadly state that the statutory license applies to any broadcast stations licensed by the FCC or any of the signals transmitted by such stations. Thus, use of the statutory license for the retransmission of a digital signal would not be precluded merely because the technological characteristics of a digital signal differ from the traditional analog signal format.
Even so, questions remain with regard to the application and operation of the cable statutory license structure in the digital television context. For this reason, we are seeking comment on the issues raised by the Copyright Owners' Petition and on additional issues raised herein.
First, in the case where the digital signal has or has had an analog counterpart, would the digital broadcast station's television market for Section 111 purposes be the same as the broadcast station's television market for the analog signal? And if the analog signal is considered distant, can the digital counterpart ever be considered local, or vice versa? Second, how should the Copyright Office determine whether a distant digital broadcast signal is permitted or non–permitted for Distant Signal Equivalent (“DSE”) purposes? Third, how does the Copyright Office determine the basis of carriage for a distant digital signal (
Would the resolution of these questions be the same in the case where the signal never had an analog counterpart? The Copyright Office seeks answers to these questions concerning the carriage of a digital signal and will consider any related issues identified by the commenters.
Copyright owners acknowledge that some cable systems are separately reporting carriage of digital and analog broadcast signals and, in their view, doing so appropriately.
Specifically, they urge the Copyright Office to clarify that, if a cable operator chooses to carry a television broadcast station's analog and digital signals, that cable operator should identify those signals separately in Space G on its SOA (
For purposes of ascertaining the royalties owed, Copyright Owners suggest that where the programming is identical, the DSE values for carriage of a distant analog and a digital signal would be the same. Alternatively, if the programming on the two signals is different (
Must a cable operator pay separately for carriage of a digital signal and an analog signal where the signals carry identical programming to the subscriber, or does the statutory license allow for a single payment for the delivery of the same programming albeit in two different formats?
We ask commenters to provide examples of where cable operators are retransmitting the analog and digital signals of the same licensee, but the programming on the primary (or main) digital signal is different than that of the analog signal. We also seek comment on how a cable operator should report the carriage of a digital signal that has been downconverted to an analog signal (at the cable operator's headend) so that subscribers without a digital set top box are able to view such signals.
For example, Station WRAL in Raleigh, North Carolina, transmits its analog signal (WRAL–TV) on channel 5 and its digital signal (WRAL–DT) on channel 5.1, which simulcasts (in some cases in HDTV) certain of the programming on channel 5. It also transmits a 24–hour news channel (WRAL–NC) on channel 5.2. And, it transmits locally–produced programming on channels 5.3 (WRAL–DT3) and 5.4 (WRAL–DT4).
Copyright Owners ask the Copyright Office to clarify that a cable operator carrying multicast signals must identify those signals separately in Space G on its SOA form. They state that a cable operator choosing to carry all of the digital channels transmitted by WRAL, for example, should state in Space G of its SOA that it carried WRAL–DT on channel 5.1; WRAL–NC on channel 5.2; WRAL–DT3 on channel 5.3; and WRAL–DT4 on channel 5.4. Copyright Owners assert that separate reporting is necessary in the case of carriage of multiple digital channels, where the copyright owners of the programming on such separate channels may be wholly different from the copyright owners of the programming on the primary digital video stream. We seek comment on the Copyright Owners' suggestions.
Copyright Owners also urge the Copyright Office to require separate calculation of DSE values and royalty payments for carriage of multiple streams of distant digital signals. If, for example, a cable operator chose to import two streams from a particular digital multicast television signal, one of which contained network programming and the other of which did not, that operator should be considered as importing 1.25 DSEs. We seek comment on Copyright Owners' proposals.
Copyright Owners did not directly discuss the retransmission of digital program–related material under Section 111 in their Petition for Rulemaking. However, they did suggest that if one digital broadcast stream contained only material that was part of the copyrighted programming on the other digital broadcast stream, the cable operator would report only a single DSE (or .25 DSE if the stream qualified as a “network station” as defined in the Copyright Act). Copyright Owners cite to
We seek comment on Copyright Owners' recommendation. We also ask whether the 1982
We note that satellite carriers and copyright owners have agreed that no separate copyright royalty payment would be due for any program–related material contained on the digital broadcast stream within the meaning of
Nevertheless, we seek comment on what changes in our rules and the SOAs are necessary to accommodate the secondary transmission of digital audio signals by cable systems. How should cable systems report the retransmission of digital audio multicast streams? Will cable subscribers need specialized equipment or set top boxes to receive these digital radio signals? If so, how would this affect a cable operator's gross receipts calculations?
The Copyright Office's regulations require reporting of the gross receipts, as defined in Section 201.17(b), for any tier of service that must be purchased in order to access the tier which contains the broadcast signals.
Copyright Owners state that cable operators often carry digital broadcast signals on a digital service tier, but for subscribers to access such signals, they must purchase other tiers of service. They note, for example, that Time Warner's Lincoln, Nebraska cable system offers several digital broadcast signals in a package as a “free” service. However, in order to receive this “free” package, a subscriber must not only rent an HDTV set top box for $7.65 per month, the subscriber must also purchase the system's “digital tier,” which contains many non–broadcast digital programming services, for an additional $6.95 per month.
Accordingly, Copyright Owners request that the Copyright Office clarify that a cable operator must include in its gross receipts any revenues from the tiers of service consumers must
Currently, cable subscribers are generally unable to receive digital (including broadcast) signals offered by their cable operator unless they obtain a special converter,
Copyright Owners are not suggesting that all cable operators are failing to include digital converter fees in their gross receipts. They note, for example, the 2004–1 SOA for Comcast's Montgomery County, Maryland cable system does appear to include digital converter fees in its calculation of gross receipts. According to Copyright Owners, the fact that some cable systems are including such converter fees in their gross receipts while others are apparently not doing so underscores the need for the Copyright Office to clarify this issue to ensure consistency in the application of the relevant rules.
Copyright Owners, therefore, request the Copyright Office to clarify that, in accordance with Section 201.17(b), a cable operator must include in its gross receipts any fees charged subscribers for digital set top boxes used to receive HDTV or other digital broadcast signals, notwithstanding that the operator may market its offering of such signals as “free.” Copyright Owners also recommend that the Copyright Office include in Space E of the cable statement of account form specific reference to “Digital and HDTV Converters” and explain that this line item refers to converters used to receive HDTV or other digital broadcast signals. We seek comment on these proposed changes.
Section 624A of the Communications Act, 47 U.S.C. 544a, governs the compatibility between cable systems and navigation devices (
We seek comment on whether cable subscribers have been required to purchase CableCards in order to access digital broadcast television signals. If so, we ask whether the Copyright Office's definition of gross receipts should be amended to include subscriber revenue generated through the lease of CableCards. How are cable operators currently treating the lease of CableCards on their SOAs? What space and block on the SOAs should be changed, or possibly added, to list CableCard revenue?
Copyright Owners state that some cable systems charge additional fees for access to digital broadcast signals to a second television set in the household. They note, for example, that Susquehanna's York, Pennsylvania, cable system charges its customers $6.95 per month for “Additional HDTV Terminals,” even though it does not charge customers for service to additional television sets receiving only an analog service.
Copyright Owners thus ask the Copyright Office to clarify that, in accordance with Section 201.17(b) of the rules, fees for service to additional digital television sets or “HDTV Terminals” must be included in a cable system's gross receipts. Copyright Owners also recommend that the Copyright Office include in Space E of the cable SOA specific reference to “Digital and HDTV Additional Set Fees” and explain that such line item refers to fees charged for service to additional television sets receiving HDTV or other digital broadcast signals. We seek comment on the changes proposed by the Copyright Owners. Moreover, some cable operators offer their subscribers in–home digital networks where one digital set top box provides digital signals to all sets in the household. We seek comment on whether the fees associated with such a service, if any, should be included in the operator's gross receipts calculation.
We hereby seek comment from the public on the issues identified herein associated with the retransmission of digital broadcast signals by cable systems under Section 111 of the Copyright Act. If there are any additional issues concerning the treatment of digital television retransmissions not discussed above, we encourage interested parties to bring those matters to our attention.