11816 Federal Register / Vol. 76, No. 42 / Thursday, March 3, 2011 / Notices 

1Copyright owners who have historically claimed 

a share of the statutory royalties are as follows: (1) 

‘‘Program Suppliers’’ (commercial entertainment 

programming) (2) ‘‘Joint Sports Claimants’’ 

(professional and college sports programming); (3) 

‘‘Commercial Television Claimants’’ (local 

commercial television programming); (4) ‘‘Public 

Television Claimants’’ (national and local 

noncommercial television programming); (5) 

‘‘National Public Radio’’ (noncommercial radio 

programming); (6) ‘‘Devotional Claimants’’ (religious 

television programming); (7) ‘‘Music Claimants’’ 

(musical works included in television 

programming); and (8) ‘‘Canadian Claimants’’ 

(Canadian television programming). 

(202) 693–2784 (this is not a toll-free 

number). 

SUPPLEMENTARY INFORMATION: Section 

188 of the Consolidated Farm and Rural 

Development Act of 1972, as established 

under 29 CFR part 75, authorizes the 

United States Department of Agriculture 

to make or guarantee loans or grants to 

finance industrial and business 

activities in rural areas. The Secretary of 

Labor must review the application for 

financial assistance for the purpose of 

certifying to the Secretary of Agriculture 

that the assistance is not calculated, or 

likely, to result in: (a) A transfer of any 

employment or business activity from 

one area to another by the loan 

applicant’s business operation; or, (b) 

An increase in the production of goods, 

materials, services, or facilities in an 

area where there is not sufficient 

demand to employ the efficient capacity 

of existing competitive enterprises 

unless the financial assistance will not 

have an adverse impact on existing 

competitive enterprises in the area. The 

Employment and Training 

Administration within the Department 

of Labor is responsible for the review 

and certification process. Comments 

should address the two bases for 

certification and, if possible, provide 

data to assist in the analysis of these 

issues. 

Jane Oates, 

Assistant Secretary for Employment and 

Training. 

[FR Doc. 2011–4804 Filed 3–2–11; 8:45 am] 

BILLING CODE 4510–FN–P 

LIBRARY OF CONGRESS 

Copyright Office 

[Docket No. RM 2010–10] 

Section 302 Report 

AGENCY: Copyright Office, Library of 

Congress. 

ACTION: Notice of Inquiry. 

SUMMARY: Congress has directed the 

Copyright Office (‘‘Office’’) to prepare a 

report addressing possible mechanisms, 

methods, and recommendations for 

phasing out the statutory licensing 

requirements set forth in Sections 111, 

119, and 122 of the Copyright Act. This 

notice seeks comment on marketplace 

solutions to replace the use of the 

statutory licenses for the retransmission 

of over-the-air broadcast signals, 

suggestions for ways to implement 

market-based licensing practices, and 

legislative and regulatory actions that 

would be needed to bring about these 

changes. 

DATES: Comments due 45 days after date 

of publication in the Federal Register. 

Reply comments due 75 days after date 

of publication in the Federal Register. 

ADDRESSES: All comments and reply 

comments shall be submitted 

electronically. A comment page 

containing a comment form is posted on 

the Copyright Office Web site at 

http://www.copyright.gov/docs/ 

section302. The Web site interface 

requires submitters to complete a form 

specifying name and organization, as 

applicable, and to upload comments as 

an attachment via a browser button. To 

meet accessibility standards, all 

comments must be uploaded in a single 

file in either the Adobe Portable 

Document File (PDF) format that 

contains searchable, accessible text (not 

an image); Microsoft Word; 

WordPerfect; Rich Text Format (RTF); or 

ASCII text file format (not a scanned 

document). The maximum file size is 6 

megabytes (MB). The name of the 

submitter and organization should 

appear on both the form and the face of 

the comments. All comments will be 

posted publicly on the Copyright Office 

Web site exactly as they are received, 

along with names and organizations. If 

electronic submission of comments is 

not feasible, please contact the 

Copyright Office at 202–707–0796 for 

special instructions. 

FOR FURTHER INFORMATION CONTACT: Ben 

Golant, Assistant General Counsel, or 

Tanya M. Sandros, Deputy General 

Counsel, Copyright GC/I&R, P.O. Box 

70400, Washington, DC 20024. 

Telephone: (202) 707–8380. Telefax: 

(202) 707–8366 or by electronic mail at 

bgol@loc.gov. 

SUPPLEMENTARY INFORMATION: 

I. Introduction 

There are three statutory licenses in 

the U.S Copyright Act governing the 

retransmission of distant and local 

television broadcast station signals. The 

cable statutory license, codified in 

Section 111 of the Act, permits a cable 

operator to retransmit both local and 

distant radio and television station 

signals to its subscribers who pay a fee 

for cable service. The satellite carrier 

statutory license, codified in Section 

119 of the Act, permits a satellite carrier 

to provide distant broadcast television 

station signals to its subscribers. 

Satellite carriers may also retransmit 

local television station signals into the 

stations’ local markets on a royalty-free 

basis pursuant to the Section 122 

statutory license. Use of this license is 

contingent upon the satellite carrier 

complying with the rules, regulations, 

and authorizations established by the 

Federal Communications Commission 

(‘‘FCC’’) governing the carriage of local 

television station signals. See 17 U.S.C. 

122(a)(2). 

Sections 111, 119, and 122 operate in 

place of transactions that would 

otherwise be left to the open 

marketplace. They allow cable operators 

and satellite carriers to retransmit the 

television broadcast content carried on 

local and distant broadcast signals 

without having to incur the transaction 

costs associated with individual 

negotiations for such programming. In 

exchange for the statutory right to 

publicly perform copyrighted broadcast 

programming, the users of the Section 

111 and Section 119 licenses pay 

royalties in accordance with the 

separate rate structures set forth in the 

law. Larger cable operators pay a 

percentage of royalties based upon the 

gross receipts generated by a cable 

system, while satellite carriers pay 

royalties on a per subscriber, per signal, 

per month basis. Cable operators and 

satellite carriers must file Statements of 

Account (and pay royalty fees) every six 

months with the Office and report 

which broadcast signals they have 

retransmitted. 

Under the statutory licenses, local and 

distant broadcast television stations 

transmit a variety of programming, 

including network and syndicated 

programming, movies, sports 

programming, local news broadcasts, 

noncommercial shows, religious 

material, and music of all types. The 

cable operators and satellite carriers pay 

royalties at the rate set forth by law. 

These royalty fees are collected by the 

Copyright Office and invested in 

government securities until the time 

that copyright owners can seek and 

participate in the process of allocating 

such fees. Under Chapter 8 of the 

Copyright Act, the Copyright Royalty 

Judges (‘‘CRJs’’), not the Office, are 

charged with authorizing the 

distribution of the royalty fees and 

adjudicating royalty claim disputes 

arising under Sections 111 and 119 of 

the Act.1

Prior to the enactment of the 

Copyright Act of 1976, U.S. copyright 


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Federal Register / Vol. 76, No. 42 / Thursday, March 3, 2011 / Notices 11817 

2With each reauthorization, Congress has 

modified the terms and conditions of the Section 

119 license and, in some cases, reduced its scope. 

For example, in 2004, Congress narrowed Section 

119 by inserting an ‘‘if local-no distant’’ provision, 

which effectively limited a satellite carrier’s 

statutory right to carry distant signals in those 

markets where local into local service is offered. 

3The Office notes that on June 30, 2008, it 

submitted a comprehensive Report to Congress 

regarding the efficacy of the Section 111, 119, and 

122 licenses. See Satellite Home Viewer Extension 

and Reauthorization Act 109 Report: A Report of 

the Register of Copyrights, June 2008 (‘‘Section 109 

Report’’). The Office cites to the record established 

in the Section 109 proceeding throughout this 

inquiry. 

4 1997 Report at 24–25. In its 1989 statutory 

licensing study, the FCC stated that, in the absence 

of Section 111, television stations would be able to 

acquire cable retransmission rights to ‘‘packages’’ of 

the programming that they broadcast. It further 

Continued 

law recognized only one statutory (or, as 

it was then called, ‘‘compulsory’’) 

license, for the making and distribution 

of phonorecords of musical 

compositions that had already been 

distributed to the public. The 1976 Act 

added a number of other statutory 

license provisions, including Section 

111. In 1988, Congress passed the 

Satellite Home Viewer Act, codifying 

Section 119 as part of the Copyright Act. 

Section 119 was designed to sunset after 

a period of five years, but Congress has 

reauthorized that Section four times 

hence in 1994, 1999, 2004, and again in 

2010 (as noted below). Currently, 

Section 119 is due to expire on 

December 31, 2014. In 1999, as part of 

the Satellite Home Viewer Improvement 

Act (‘‘SHVIA’’), Congress enacted 

Section 122, the local-into-local license. 

Section 122, as well as Section 111, are 

permanent and are not subject to 

‘‘sunset’’ like Section 119, although 

Congress in 2010 had updated the text 

of both sections to some degree.2

II. Section 302 of the Satellite 

Television Extension and Localism Act 

A. Background 

On May 27, 2010, the President 

signed the Satellite Television 

Extension and Localism Act of 2010. 

See Public Law 111–175, 124 Stat. 1218 

(2010) (hereinafter ‘‘STELA’’). The 

legislation extended the term of the 

Section 119 license for another five 

years, updated the statutory license 

structures to account for changes 

resulting from the nationwide transition 

to digital television, and revised the 

Section 111 and Section 122 licenses in 

several other respects. In addition, 

STELA instructed the Copyright Office, 

the Government Accountability Office 

(‘‘GAO’’) and the FCC to conduct studies 

and report findings to Congress on 

different structural and regulatory 

aspects of the broadcast signal carriage 

marketplace in the United States. 

Section 302 of STELA, entitled 

‘‘Report on Market Based Alternatives to 

Statutory Licensing,’’ charges the 

Copyright Office with the following: 

Not later than 18 months after the 

date of the enactment of this Act, and 

after consultation with the Federal 

Communications Commission, the 

Register of Copyrights shall submit to 

the appropriate Congressional 

committees a report containing: 

(1) Proposed mechanisms, methods, and 

recommendations on how to implement a 

phase-out of the statutory licensing 

requirements set forth in sections 111, 119, 

and 122 of title 17, United States Code, by 

making such sections inapplicable to the 

secondary transmission of a performance or 

display of a work embodied in a primary 

transmission of a broadcast station that is 

authorized to license the same secondary 

transmission directly with respect to all of 

the performances and displays embodied in 

such primary transmission; 

(2) any recommendations for alternative 

means to implement a timely and effective 

phase-out of the statutory licensing 

requirements set forth in sections 111, 119, 

and 122 of title 17, United States Code; and 

(3) any recommendations for legislative or 

administrative actions as may be appropriate 

to achieve such a phase-out. 

In response to these directives, the 

Office now seeks comments and 

information from the public on several 

issues that are central to the scope and 

operation of Section 302 and critical to 

the Office’s analysis of the legal and 

business landscapes.3 This Notice of 

Inquiry (‘‘NOI’’) summarizes these 

issues, raises a number of specific 

questions for public consideration, and 

invites other comments as appropriate 

and relevant. 

B. Fulfilling the Mandates of Section 

302 

1. Section 302: Goals of the study 

The Office expects to achieve several 

goals in its report to Congress. First, it 

seeks to provide Congress with a 

balanced appraisal of the marketplace 

arrangements that could occupy the 

space left open if Sections 111, 119, and 

122 were eliminated from the Copyright 

Act. Next, it intends to offer Congress a 

choice of options from which it might 

approach and repeal the statutory 

licenses. Finally, in order to provide 

context and points of comparison for 

our report, the Office intends to discuss 

the current state of licensing in the 

video programming marketplace. 

2. Replacing the Statutory Licenses 

In the absence of the statutory 

licenses, cable operators and satellite 

carriers would need to rely on 

marketplace mechanisms to clear the 

public performance rights for the 

content transmitted by broadcast 

stations. The intent here is to explore 

marketplace alternatives that would 

permit cable operators and satellite 

carriers to retransmit the entire 

broadcast signal just as they have been 

allowed to do under the statutory 

licenses. The Office submits that there 

are at least three different approaches 

that should be considered in this 

discussion: (1) Sublicensing, (2) private 

licensing, and (3) collective licensing. 

The Office seeks comment on the 

viability of each of these approaches 

and welcomes input on other possible 

licensing options. 

a. Sublicensing. Section 302(1) of 

STELA directs the Office to study how 

to implement a phase-out of the Section 

111, 119 and 122 statutory licenses ‘‘by 

making such sections inapplicable to 

the secondary transmission of a 

performance or display of a work 

embodied in a primary transmission of 

a broadcast station that is authorized to 

license the same secondary transmission 

directly with respect to all of the 

performances and displays embodied in 

such primary transmission.’’ This 

approach involves a marketplace 

transaction known as sublicensing. 

Sublicensing in the context of the video 

program marketplace involves nonexclusive contractual arrangements 

whereby a television station, while 

negotiating licenses with copyright 

owners for the public performance of 

copyrighted programming in a local 

market, would also negotiate permission 

for the broadcast station to sublicense to 

third party distributors such as cable 

operators and satellite carriers. 

Sublicense agreements are essentially 

non-exclusive contracts that allow 

broadcast stations to convey 

performance rights to others in the 

distribution chain. Both the extent of 

the rights and the fees for further use 

could be fixed as part of the initial 

contract between the copyright owner 

and the broadcaster. 

In its 1997 Report to Congress entitled 

‘‘A Review of the Copyright Licensing 

Regimes Covering Retransmission of 

Broadcast Signals’’ (‘‘1997 Report’’), the 

Office asked, as an alternative to 

statutory licensing, whether the 

government should require broadcast 

stations to acquire cable retransmission 

rights from copyright owners, and allow 

the cable operator to negotiate with the 

broadcast station for the entire signal. 

The Office noted that this mechanism 

was first suggested by the FCC as a 

marketplace alternative to the Section 

111 license.4 The Office did not make 


srobinson on DSKHWCL6B1PROD with NOTICES
11818 Federal Register / Vol. 76, No. 42 / Thursday, March 3, 2011 / Notices 

stated that cable operators could then negotiate 

with a single entity, the broadcast station, for 

carriage rights to each package. The FCC remarked 

that the creation of dozens of cable networks by the 

cable and content industries provided ‘‘convincing 

evidence’’ that the transactions costs associated 

with full copyright liability are quite manageable. 

The FCC believed that this method is efficient and 

practical. The FCC concluded that this 

‘‘networking’’ mechanism that is so widely 

employed in other forms of video distribution, 

appeared well-suited to the acquisition of cable 

retransmission rights for broadcast signals as well. 

Id., citing 1989 FCC Study, 4 FCC Rcd at 6712. 

5This point was raised by Disney in its testimony 

submitted to the Copyright Office during hearings 

on Section 109 of the SHVERA in 2007. See Section 

109 Hearing Testimony of Preston Padden at 2 (July 

24, 2007). 

6See Policy Decision Concerning Status of Low 

Power Television Stations, 49 FR 46829, 46830 

(Nov. 28, 1984) (‘‘If copyright owners and cable 

systems uniformly agree that negotiated 

retransmission consents supersede the compulsory 

license requirements, the Copyright Office has no 

reason to question this interpretation provided that 

the negotiated license covers retransmission rights 

for all copyrighted works carried by a particular 

broadcasting station for the entire broadcast day for 

each day of the entire accounting period.’’). 

7See Letter to Faye W. Eden, Coxcom Inc., from 

Donna M. Thacker, Sr. Licensing Examiner, U.S. 

Copyright Office, dated March 30, 2002 

(acknowledging that WUNI has been carried by Cox 

under a private licensing agreement) (letter on file 

with the Licensing Division of the Copyright 

Office). 

any specific recommendations regarding 

sublicensing in its 1997 Report. 

In the Section 109 Report, however, 

the Office did state that sublicensing 

was a possible, and reasonable, 

alternative to statutory licensing. The 

Office noted that it is a market-driven 

concept that has been in practice as long 

as cable operators have carried nonbroadcast networks. It further noted that 

sublicensing has been so successful that 

there are now over 500 channels of 

video programming available for 

distribution in the multichannel 

marketplace.5 The Office concluded that 

Sections 111 and 119 have impeded the 

development of a sublicensing system 

and only when these statutory licenses 

are repealed will it be known whether 

sublicensing is a workable solution. 

Sublicensing is not an option that was 

viewed positively by all commenters in 

the Section 109 proceeding. In its 

comments, NAB argued that a 

sublicensing approach, under which 

broadcasters would be expected to 

acquire distant market retransmission 

rights and then license them to cable 

operators and satellite carriers, would 

not work as a direct substitute for the 

statutory licenses. According to NAB, 

broadcasters whose stations are 

currently retransmitted as distant 

signals, typically by a handful of 

systems in adjacent television markets, 

have no core financial incentive to 

engage in sublicensing. It commented 

that since broadcasters rely principally 

on advertising revenues, and advertisers 

would not assign value to potential 

audiences in a few scattered cable 

communities outside the station’s home 

market, ‘‘there is no direct economic 

incentive for such broadcasters to 

undertake the cost and administrative 

burden of acting as a clearinghouse for 

such distant carriage rights.’’ NAB Reply 

Comments in the Section 109 

Proceeding at 7–8. 

NAB stated that neither the 

prevalence of cable networks nor even 

the rise of an after-market for the 

delivery of individual broadcast 

network programs supports the 

proposition that sublicensing would be 

a viable alternative to the statutory 

licenses. It commented that the factors 

relevant in those situations are not 

applicable to broadcasters, who focus 

their economic activities on the local 

market. NAB concluded that the 

fundamental economic model that 

drives such cable networks simply does 

not translate to the broadcast station 

context. Id. 

Issues and Questions. The Office 

seeks comment on whether sublicensing 

is an effective alternative to both the 

local and distant signal statutory 

licenses, including specifically, 

comments about the current state of 

sublicensing of television programming 

in the United States. For example, how 

does sublicensing function in the 

marketplace today, especially with 

regard to basic cable networks? Are 

broadcast stations truly different from 

cable networks as the NAB suggests? 

What percentage of the public view 

broadcast stations through their cable 

and satellite subscriptions rather than 

directly over the air? If most of the 

public accesses television stations 

through multichannel video 

programming distributors, would this 

provide an incentive for the 

broadcasters to take another look at 

sublicensing the content for secondary 

transmission? Are there sublicensing 

examples from other countries that may 

be used as models in this regard? The 

Office also welcomes any scholarly 

articles on sublicensing audiovisual 

content or related issues that will 

inform the debate. 

b. Private Licensing. Another 

possibility is that interested parties 

would develop and choose to engage in 

forms of direct licensing in the event 

statutory licensing were eliminated. 

Under this option, a cable operator or 

satellite carrier would negotiate with 

each copyright owner of a specific 

broadcast program for the right to 

perform the work publicly. On this 

point, it is important to note that the 

current distant signal licenses do not bar 

such arrangements. Copyright owners 

and cable operators have always been 

free to enter into private licensing 

agreements for the retransmission of 

distant broadcast programming. The 

Copyright Office has, in fact, accepted 

the use of private licensing in lieu of the 

cable statutory license to clear the 

public performance rights for broadcast 

content carried on the signal.6 On this 

point, the Office notes that there are 

public records in the Copyright Office 

noting the existence of private copyright 

license agreements between television 

station group owner Entravision 

Communications Corporation and cable 

operators in Rhode Island for the 

carriage of broadcast content 

transmitted by WUNI–TV.7 Broadcast 

stations that own the rights to the 

programs they transmit have also 

negotiated programming agreements 

with satellite carriers outside the 

context of Section 119. For example, 

DirecTV reported that it has entered into 

agreements for the retransmission of 

broadcast programming transmitted by 

certain television stations in Puerto 

Rico. See Section 109 Report at 86. 

Nevertheless, the private licensing of 

broadcast content has not been 

widespread because cable operators and 

satellite carriers have grown accustomed 

to using the statutory licenses and few 

broadcast stations own all the rights to 

the programming carried on their 

signals. 

Under one possible private licensing 

model, the copyright owner and either 

the cable system or satellite carrier 

would enter into a written agreement 

covering the public performance right 

for the copyrighted work. The statutory 

license would be replaced with a 

marketplace-based license from a single 

individual or entity that has the right to 

authorize the retransmission of the 

copyrighted content carried on the 

broadcast signal, such as in the case of 

WUNI–TV, noted above. The Office 

seeks comment on whether privately 

negotiated copyright licenses, of the 

type described above, are a plausible 

and effective marketplace alternative to 

the three existing statutory licenses. To 

gauge the practicality of private 

licensing options, the Office seeks 

comment on how many private 

copyright licenses currently exist and 

how they function. Moreover, the Office 

seeks comment on whether there are 

any successful private licensing models 

in operation outside the United States 

that the Office may examine for 

purposes of this inquiry. 


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Federal Register / Vol. 76, No. 42 / Thursday, March 3, 2011 / Notices 11819 

8Recent press reports indicate that seven 

companies (CBS, Disney, Discovery, Fox, NBC 

Universal, Time Warner, and Viacom) account for 

90% of all the professionally produced video that 

people watch. See David Lieberman, Web and Other 

Options are Shaking Up How We Watch TV, USA 

TODAY, http://www.usatoday.com (Jan. 3, 2011). 

However, there are an indeterminable number of 

copyright owners who own the 10% of video 

programming not produced by the top seven. 

9See Leading Entertainment Companies Create 

Registry for Movie and Television Content, 

GlobalNewsWire.com (Oct. 27, 2010), http:// 

www.globenewswire.com/ (‘‘Members of EIDR will 

have open access to the registry and/or be able to 

supply their content to the registry for 

identification. For content distributors, access to 

unique IDs will help eliminate confusion between 

assets with the same name or different cuts of the 

same video, helping to ensure that the right 

products are being distributed to the consumer. For 

content producers, the ability to register all of their 

assets will help simplify their post-production 

process and potentially lead to greater distribution 

of their products. Other companies in the supply 

chain can benefit from a streamlined 

communication process between their suppliers 

and distributors.’’) 

Finding Copyright Owners. The Office 

recognizes that private licensing may be 

difficult when there are multiple 

copyright owners in the marketplace. 

There are thousands of hours of 

programming broadcast by television 

stations on a weekly basis.8 Before 

private negotiations can commence, 

cable operators and satellite carriers 

must be able to identify the rights 

holders to the programs carried by 

broadcast stations. This daunting task 

has been ameliorated by the existing 

statutory licensing systems, but it would 

have to be confronted if Sections 111, 

119, and 122, were repealed. 

On this point, the Office notes that 

certain parties are working on an 

extensive video program cataloging 

effort to identify the universe of 

audiovisual content available to the 

public. According to trade press reports, 

a new international coalition announced 

the launch of the Entertainment 

Identifier Registry (‘‘EIDR’’), a non-profit 

global independent registry that 

provides a uniform approach to 

cataloging movies, television shows, 

and other commercial audiovisual 

assets, with unique identifiers (‘‘IDs’’). 

The registry is set up as an industry 

resource to help streamline digital 

commerce and simplify consumer 

transactions.9 The Office seeks comment 

on this effort and ask whether such a 

registry could be used to facilitate 

private copyright clearances by quickly 

identifying the copyright owner(s) 

associated with the rights to a particular 

broadcast program and perhaps serve as 

a clearing house for use of the work 

based on rate schedules established by 

copyright owners. If the EIDR is inapt 

for identifying the owners of broadcast 

content for retransmission purposes, the 

Office seeks comment on possible 

alternatives that would perform the 

same function. 

In the Section 109 Report proceeding, 

the record revealed that cable operators 

were carrying, on average, two to three 

distant signals per system. See Section 

109 Report at 51. The Office seeks 

comment on whether this information is 

still accurate or whether recent 

trendlines indicate either a decrease or 

increase in the number of distant signals 

carried. If the number of distant signals 

is low, then it may not be so 

burdensome to negotiate private license 

agreements with the copyright owners 

of the programming carried on this 

finite set of signals, if the owners of the 

copyrighted content could be easily 

identified. However, the Office 

recognizes that both cable operators and 

satellite carriers may have a heavier 

burden if they have to negotiate for the 

public performance rights of content on 

local broadcast signals, in the absence of 

Sections 111 and 122, given that there 

are nearly 1,800 full power television 

stations in the 210 markets across the 

United States. The Office notes, 

however, that hundreds of television 

stations are affiliated with several 

national broadcast networks and carry 

similar daytime and primetime 

programming across markets. Is it 

practicable to use private licensing 

arrangements to clear the rights for all 

programs transmitted by local television 

stations? Does the presence of a 

significant amount of national network 

programming on local broadcast stations 

makes private licensing a more 

manageable task? 

Hold-ups. In the Section 109 Report 

proceeding, Echostar explained the 

‘‘hold-up’’ phenomenon inherent in the 

rights clearance process. It asserted that 

when the last content owner in a 

station’s broadcast line-up ‘‘comes to the 

table’’ to negotiate, this owner may have 

an unfair advantage. It stated that the 

copyright holder can ‘‘hold up’’ the 

negotiations by demanding excessive 

compensation for broadcast rights 

because without the agreement, the 

distributor will end up carrying a 

channel with a ‘‘hole’’ in its schedule. 

Echostar Comments in the Section 109 

Proceeding at 8. The Office seeks 

comment on the extent of this problem 

and whether other program suppliers 

would see it as an opportunity to air 

their programming in the open slot. On 

the other hand, if hold-ups are, in fact, 

impediments to private negotiations, the 

Office asks whether this should be a 

reason not to recommend private 

licensing as a marketplace option and if 

there are legislative solutions that could 

address the problem. 

c. Collective Licensing. Collective 

licensing is another possible alternative 

to statutory licensing. Like private 

licensing, it can take a variety of specific 

forms, but in general, it would require 

copyright owners to voluntarily 

empower one or more third party 

organizations to negotiate licenses with 

cable operators and satellite carriers for 

the public performance rights for their 

works transmitted by a television 

broadcast station. In the Section 109 

Report, the Office found that collective 

licensing was a possible marketplace 

solution that users and copyright 

owners may consider for the efficient 

disposition of the public performance 

right to broadcast television 

programming. Section 109 Report at 90. 

At this time, there are no collective 

licensing bodies in the United States 

whose business it is to license the 

public performance of audiovisual 

works transmitted by television 

broadcast signals. However, there are 

currently three performance rights 

organizations (‘‘PROs’’) that administer 

the public performance right on behalf 

of the copyright owners of musical 

works: (1) The American Society of 

Composers, Authors and Publishers 

(‘‘ASCAP’’); (2) Broadcast Music, Inc. 

(‘‘BMI’’); and (3) SESAC, Inc. These 

organizations offer a blanket, 

nonexclusive license to users, allowing 

them to publicly perform the music in 

the PROs’ respective repertories. 

It should be noted that ASCAP and 

BMI operate under government 

supervision. To protect licensees from 

possible monopolistic behavior and 

antitrust concerns associated with 

PROs, the U.S. Department of Justice 

has entered into court-administered 

antitrust consent decrees with BMI and 

ASCAP. Both consent decrees have been 

updated over time and are similar in 

scope. The consent decrees allow 

ASCAP and BMI to administer the 

public performance right for musical 

works. They also require the PROs to 

grant a public performance license on a 

non-exclusive basis and deter 

discrimination amongst similarly 

situated licensees. The consent decrees 

require per-program licensing as an 

option for licensees instead of obliging 

everyone to purchase a blanket license. 

A significant provision in the consent 

decrees is the designation of the United 

States District Court for the Southern 

District of New York as a special rate 

court which resolves license fee 

disputes. If the PRO and the prospective 

licensee cannot agree on a reasonable 

fee for a proposed license, then either 

party can petition the special rate court 

to resolve the issue. SESAC is currently 

not bound by a consent decree, but in 


srobinson on DSKHWCL6B1PROD with NOTICES
11820 Federal Register / Vol. 76, No. 42 / Thursday, March 3, 2011 / Notices 

10Amended Complaint at 2, 35–36, Meredith 

Corp. v. SESAC, No. 09–9177 (S.D.N.Y. Mar. 18, 

2010). 

11The Office notes, for example, that collective 

licensing has played a crucial role in the European 

Union. Anke Schierholz, Collective Rights 

Management in Europe: Practice and Legal 

Framework, in European Copyright Law: A 

Commentary 1150 (Michel M. Walter & Silke von 

Lewinski eds., 2010); see also, Daniel Gervais, 

Collective Management of Copyright: Theory and 

Practice in the Digital Age, COLLECTIVE 

MANAGEMENT OF COPYRIGHT: THEORY AND 

PRACTICE IN THE DIGITAL AGE (Wolters Kluwer, 

2d ed. 2010); Thomas Riis & Jens Schovsbo, 

Extended Collective Licenses and the Nordic 

Experience—Its a Hybrid but is It a Volvo or a 

Lemon?, 33 Colum. J.L. & Arts 1, 11 (2010). 

2009, a class action lawsuit, which is 

still pending, was filed on behalf of 

local television stations alleging that 

SESAC is engaged in price fixing and 

other anticompetitive acts.10

Questions for the Public. The Office 

generally seeks comment on the 

benefits, drawbacks, costs, and 

operation of collective licensing 

structures for copyrighted works. 

Specifically, the Office seeks comment 

on the U.S. system for the collective 

licensing of music and whether there 

are any lessons to be learned in 

developing a collective licensing body 

for audiovisual works. If collective 

licensing of broadcast television content 

in the United States was found to be the 

appropriate marketplace replacement 

for Sections 111, 119, and 122, would 

oversight mechanisms like the consent 

decrees noted above be necessary? The 

Office also seeks input on collective 

licensing models around the world that 

may be relevant to our study.11 Finally, 

the Office asks whether there are any 

regulatory impediments or other legal 

issues that may prevent parties from 

entering into collective agreements. 

d . Other Licensing Alternatives. This 

Notice raises specific questions about 

three marketplace approaches to 

licensing copyrighted broadcast 

television content in the marketplace. 

However, these identified licensing 

systems should not be viewed as the 

universe of possible options nor should 

comments be limited to these three 

approaches. Comment on other possible 

marketplace solutions, not mentioned 

above, that would facilitate the cable 

and satellite retransmission of programs 

carried by television broadcast stations, 

are encouraged. 

3. Eliminating the Statutory Licenses 

The Office has two core mandates 

under Section 302 of the STELA. The 

first is to consider and recommend 

possible alternatives to the current 

statutory licensing systems in the 

Copyright Act, with a particular but not 

an exclusive focus on sublicensing by 

broadcasters. The second is to consider 

and recommend ‘‘a timely and effective 

phase-out’’ of the three licenses. While 

this step concerns ‘‘process’’ rather than 

‘‘substance,’’ some of the suggested 

approaches are keyed to the marketbased alternatives previously discussed. 

That is, any proposals addressing the 

elimination of the statutory licenses 

would need to be considered in the 

context of specific marketplace 

solutions. Thus, the phase-out options 

are offered as conceptual blueprints that 

may be redrawn in light of the 

comments regarding the appropriate 

replacements for the existing statutory 

licensing systems. Moreover, the 

approaches addressed below may not be 

the only phase-out options available. As 

such, recommendations on other 

possible alternatives are welcome and 

will be considered. 

a. The Per-Station Approach. Under 

this plan, the respective statutory 

licenses would be unavailable where the 

public performance rights for all of the 

programs on a single broadcast station 

can be cleared through a single entity 

and carriage terms and conditions are 

made available to the distributor in a 

timely manner so that it is able to enter 

into a private carriage agreement. The 

Office believes that this approach 

closely approximates the intent of 

Congress as reflected in Section 302(1) 

of STELA. The Office seeks comment on 

whether this piecemeal approach is a 

viable ‘‘phase-out’’ option. Assuming 

that a single entity could clear the 

rights, would negotiations between the 

licensing entity and each cable system 

and satellite carrier be necessary? 

Would this option be more workable if 

the single entity holding the rights were 

required to establish a rate schedule 

based on criteria that would ensure 

uniformity of treatment among similarly 

situated cable systems and satellite 

carriers? 

b. The Staggered Approach. An 

alternative means to eliminate the 

statutory licenses is for Congress to 

gradually phase them out over a period 

of time. Under this approach, Congress 

could first eliminate the distant signal 

licensing constructs on a set date and 

then repeal the local-into-local licensing 

constructs a few years later. Given that 

cable operators and satellite carriers 

retransmit significantly more local 

broadcast stations than distant broadcast 

stations, this method would allow the 

cable and satellite industries more time 

to plan ahead and clear public 

performance rights with copyright 

owners of programming transmitted by 

broadcast stations in a local market. The 

Office seeks comment on this approach 

and its benefits and drawbacks. The 

Office seeks specific comment on 

whether this method would be 

considered ‘‘timely’’ as that term is used 

in Section 302. 

c. The Statutory Sunset Approach. 

Another possible approach to ending 

the statutory licensing systems for the 

retransmission of broadcast television 

signals is by Congressional edict. Under 

this framework, Congress would 

establish a hard date to repeal Sections 

111, 119, and 122 all at once. For 

example, Congress could enact 

legislation in January 2013 that would 

repeal the licenses effective as of 

January 1, 2015. An alternative plan, at 

least for Section 119, is for Congress to 

sunset the satellite distant signal license 

in those markets where local-to-local 

service is available on a defined date. 

The Office notes, however, that the 

elimination of the statutory licenses on 

a date certain could lead to channel 

line-up disruptions on a large scale as 

broadcast signals would likely be 

dropped by cable operators and satellite 

carriers unless a workable marketplace 

solution for the retransmission of 

broadcast content is in place 

beforehand. How much time would be 

needed to establish marketplace 

alternatives and would it be necessary 

to have a transition period during which 

the statutory license would remain 

available? The Office also notes that at 

least insofar as local broadcast stations 

are concerned, elimination of the 

statutory licenses would be difficult to 

implement if the Communications Act’s 

broadcast signal carriage provisions 

remain in place. Without legislation 

addressing the issues surrounding the 

mandatory carriage of local television 

signals under title 47 of the U.S. Code, 

cable operators and satellite carriers 

would be stuck with a carriage 

obligation without the right to 

retransmit the programming carried on 

those signals. The Office seeks specific 

comment on these possibilities and asks 

for input on what other drawbacks may 

result from the adoption of a flash cut 

option. 

III. Licensing Models in the New Video 

Programming Marketplace 

As discussed below, cable operators, 

satellite carriers, and copyright owners 

have experimented with innovative 

content distribution strategies over the 

last decade. Creative licensing 

arrangements have developed alongside 

these new business models. The Office 

seeks comment on three new 

programming models: (1) Video on 

Demand; (2) DirecTV’s ‘‘The 101’’ linear 

channel; and (3) online video 

distribution, and asks how these new 

licensing structures work and how they 


srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 76, No. 42 / Thursday, March 3, 2011 / Notices 11821 

12How Much Network Programming Was 

Actually ‘‘On Online’’ This Season? Clicker Blog, 

http://www.clicker.com (July 13, 2010). 

13Comcast will begin to stream live content from 

Time Warner’s cable networks later this year under 

their TV Everywhere licensing agreement. See Todd 

Spangler, Comcast, Turner Broaden TV Everywhere 

Pact to Cover Live Streaming, http:// 

www.broadcastingcable.com (Feb. 2, 2011). There 

are no press reports indicating whether or when 

cable operators will be carrying broadcast content 

under the TV Everywhere plan. 

14Hulu management has recently discussed 

recasting the service as an ‘‘online cable operator’’ 

that would use the Internet to send live television 

channels and video-on-demand content to 

subscribers. See Sam Schechner and Jessica 

Vascellaro, Hulu Reworks Its Script as Digital 

Change Hits TV, Wall Street Journal, January 27, 

2011. 

15Syncbak’s proprietary authentication 

technology synchronizes broadband and broadcast 

delivery of television, creating a means for viewers 

to watch broadcast content in real-time on any 

broadband enabled device. See http:// 

www.syncbak.com. Syncbak offers a technical 

solution to the Internet delivery of broadcast 

stations; it is not an agent for clearing the public 

performance rights for programs carried on such 

stations. 

benefit all stakeholders in the 

distribution chain. This information 

will help the Office understand how the 

video programming marketplace 

functions and the kinds of licensing 

arrangements that drive the online 

market. 

Video-on-Demand. Over the past 

decade, cable operators have offered 

video-on-demand (‘‘VOD’’) services over 

their platforms. VOD allows subscribers 

to select and view individual television 

programs and movies, for free or for a 

fee, on an a la carte basis any time 

during the day. The Office seeks 

comment on how copyright owners 

license content for VOD distribution, 

and the extent to which it might obviate 

the need for continued operation of the 

section 111, 119 and 122 statutory 

licenses. 

Linear Channel Packaging. DirecTV 

currently offers to its subscribers ‘‘The 

101,’’ a satellite channel carrying older, 

or recently cancelled, broadcast and 

cable programming. In contrast to VOD, 

which permits subscribers to select and 

choose individual program offerings, the 

101 is a linear channel designed and 

structured by DirecTV that is available 

to its customers on a 24 hour/7 days a 

week basis. The Office seeks comment 

on how DirecTV obtains and licenses 

content for The 101, and the extent to 

which such services might obviate the 

need for continued operation of the 

section 111, 119 and 122 statutory 

licenses. 

Online Video. It is likely that more 

and more television programming will 

migrate to the Internet in the years 

ahead. Broadcast content is now widely 

available to consumers through 

streaming video services and perprogram downloads available at Apple’s 

iTunes store and other outlets. In fact, 

some estimate that fifty percent of 

broadcast network content is available 

on online platforms the day after it airs 

on television.12 Many of these shows 

have been available for free online for a 

number of years through Web services 

such as Hulu.com or directly from the 

network’s Web site. Is the television 

marketplace entering an era when the 

current statutory licenses are no longer 

needed because all broadcast 

programming is becoming available 

online? 

In addition to the pantheon of free 

online video services, there are two 

burgeoning types of subscriber-based 

streaming television models that have 

gained notoriety in the marketplace. 

First is the ‘‘TV Everywhere’’ model 

where cable/satellite subscribers who 

can confirm their TV subscription 

through an online registration process, 

can watch live cable programming on 

the Web just as it appears on TV for no 

additional charge.13 The second model 

is exemplified by online subscription 

services such as Hulu Plus and Netflix 

that allow subscribers to watch 

television shows and motion pictures 

online by paying a monthly fee directly 

to the service, without the need to be a 

cable or satellite subscriber.14 And, it is 

worth noting that the broadcast industry 

is also taking part in the development of 

a secured online distribution system, 

powered by Syncbak, which will enable 

the online viewing of local television 

signals in their local markets.15

Questions for the public. The Office 

seeks comment on how broadcast 

content is licensed for distribution over 

the Internet and what types of business 

models are likely to succeed in the 

online space. Further, the Office seeks 

comment on whether the TV 

Everywhere effort and popular services, 

such as Hulu and Netflix, will 

eventually offer live broadcast signals to 

their subscribers with a broadband 

connection. If so, we ask what licensing 

models might be used to clear the public 

performance rights for programs carried 

by television broadcast stations for 

online distribution, by aggregators like 

Hulu, or through technological 

solutions, as exemplified by Syncbak, 

and whether these alternative means of 

obtaining access to broadcast 

programming will vitiate the rationale 

underlying the Section 111, 119 and 122 

statutory licenses. 

IV. Conclusion 

The Office hereby seeks comment 

from the public on the factual and 

policy matters related to the study 

mandated by Section 302 of the Satellite 

Television Extension and Localism Act 

of 2010. If there are any additional 

pertinent issues not discussed above, 

the Office encourages interested parties 

to raise those matters in their comments. 

In addition, the Office is considering 

having a roundtable or formal hearing 

on the matters raised in this NOI in June 

2011. An announcement of such a 

proceeding, if it were to occur, will be 

provided by public notice in the future. 

Dated: February 25, 2011. 

Maria A. Pallante, 

Acting Register of Copyrights. 

[FR Doc. 2011–4717 Filed 3–2–11; 8:45 am] 

BILLING CODE 4110–30–P 

NATIONAL SCIENCE FOUNDATION 

Submission for OMB Review; 

Comment Request Survey of Principal 

Investigators on Earthquake 

Engineering Research Awards Made 

by the National Science Foundation, 

2003–2009 

SUMMARY: Under the provisions of 

Section 3507(a)(1)(D) of the Paperwork 

Reduction Act of 1995, the National 

Science Foundation has submitted to 

the Office of Management and Budget 

(OMB) a request to review and approve 

the information collection listed below. 

This proposed information collection 

was previously published in the Federal 

Register on October 22, 2010 (volume 

75, number 204, page 65385) and 

allowed 60-days for public comment. 

No comments were received from 

members of the public. The purpose of 

this notice is to allow an additional 30 

days for public comment. 

Request for Comments: Written 

comments and/or suggestions from the 

public and affected agencies are invited 

on one or more of the following points: 

(1) Whether the proposed collection of 

information is necessary for the proper 

performance of the function of the 

agency, including whether the 

information will have practical utility; 

(2) the accuracy of the agency’s estimate 

of the burden of the proposed collection 

of information, including the validity of 

the methodology and assumptions used; 

(3) ways to enhance the quality, utility, 

and clarity of the information to be 

collected; and (4) ways to minimize the 

burden of the collection of information 

on those who are to respond, including 

the use of appropriate automated, 

electronic, mechanical, or other 

technological collection techniques or 

other forms of information technology. 


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