```

[Federal Register Volume 77, Number 230 (Thursday, November 29, 2012)]
[Rules and Regulations]
[Pages 71104-71109]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-28785]

-----------------------------------------------------------------------

LIBRARY OF CONGRESS

Copyright Royalty Board

37 CFR Part 381

[Docket No. 2011-2 CRB NCEB II]

Determination of Reasonable Rates and Terms for Noncommercial 
Broadcasting

AGENCY: Copyright Royalty Board, Library of Congress.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Copyright Royalty Judges are publishing final regulations 
setting the rates and terms for use of certain works in connection with 
noncommercial broadcasting for the period commencing January 1, 2013, 
and ending on December 31, 2017.

DATES: Effective Date: January 1, 2013.
    Applicability Dates: The regulations apply to the license period 
January 1, 2013, through December 31, 2017.

FOR FURTHER INFORMATION CONTACT: LaKeshia Keys, Program Specialist, by 
telephone at (202) 707-7658 or email at crb@loc.gov.

SUPPLEMENTARY INFORMATION: Section 118 of the Copyright Act, title 17 
of the United States Code, establishes a statutory license for the use 
of certain copyrighted works in connection with noncommercial 
television and radio broadcasting. Chapter 8 of the Copyright Act 
requires the Copyright Royalty Judges (``Judges'') to conduct 
proceedings every five years, beginning in 2006, to determine the rates 
and terms for the section 118 license. 17 U.S.C. 804(b)(6). 
Accordingly, the Judges conducted a proceeding to determine the rates 
and terms for the license period 2008-2012 and published final 
regulations on November 30, 2007. 72 FR 67646.
    On January 5, 2011, the Judges published in the Federal Register a 
notice commencing the proceeding to determine the rates and terms for 
the 2013-2017 license period and requesting submission of petitions to 
participate from interested parties. 76 FR 591. Petitions to 
Participate were received from: The American Society of Authors, 
Composers and Publishers (``ASCAP''); SESAC, Inc.; Broadcast Music, 
Inc. (``BMI''); Educational Media Foundation (``EMF''); Music Reports, 
Inc. (``MRI''); National Public Radio, the Public Broadcasting Service, 
and noncommercial radio and television stations eligible to receive 
funding from the Corporation for Public Broadcasting jointly (``NPR/
PBS/CPB''); National Religious Broadcasters Noncommercial Music License 
Committee (``NRBNMLC''); the Church Music Publishers' Association; the 
National Music Publishers' Association, Inc. and the Harry Fox Agency, 
jointly (``NMPA/HFA''); the Catholic Radio Association (``CRA''); and 
the American Council on Education (``ACE''). The Judges set the 
timetable for the three-month negotiation period, see 17 U.S.C. 
803(b)(3), and directed the participants to submit their written direct 
statements no later than October 30, 2011. The Judges received written 
direct statements from CRA, BMI, ASCAP, and MRI,\1\ as well as several 
notifications of settlement and proposed rates and terms for the Judges 
to adopt.
---------------------------------------------------------------------------

    \1\ Pursuant to 17 U.S.C. 803(b)(6)(C)(x), the Judges set the 
60-day discovery period to run from November 30, 2011, through 
January 30, 2012. During the discovery period, MRI and CRA each 
withdrew from the proceeding on December 13, 2011, and January 27, 
2012, respectively.
---------------------------------------------------------------------------

    There are two ways that copyright owners and public broadcasting 
entities \2\ may negotiate rates and terms under the section 118 
statutory license. First, copyright owners may negotiate rates and 
terms with specific public broadcasting entities for the use of all of 
the copyright owners' works covered by the license. Section 118(b)(2) 
provides that such license agreements ``shall be given effect in lieu 
of any determination by the * * * Copyright Royalty Judges,'' provided 
that copies of the agreement are submitted to the Judges ``within 30 
days of execution.'' 17 U.S.C. 118(b)(2). The Judges received several 
agreements

[[Page 71105]]

in this category; no further action is required with respect to these 
agreements.
---------------------------------------------------------------------------

    \2\ A ``public broadcasting entity'' is defined as a 
``noncommercial educational broadcast station as defined in section 
397 of title 47 and any nonprofit institution or organization 
engaged in the activities described in paragraph (2) of subsection 
(c)'' of section 118. 17 U.S.C. 118(f).
---------------------------------------------------------------------------

    Second, copyright owners and public broadcasting entities may 
negotiate rates and terms for categories of copyrighted works and uses 
that would be binding on all owners and entities and submit them to the 
Judges for approval. Section 801(b)(7)(A) provides that in such event:

    (i) The Copyright Royalty Judges shall provide those that would 
be bound by the terms, rates, or other determination set by any 
agreement in a proceeding to determine royalty rates an opportunity 
to comment on the agreement and shall provide to participants in the 
proceeding under section 803(b)(2) that would be bound by the terms, 
rates, or other determination set by the agreement to comment on the 
agreement and object to its adoption as a basis for statutory terms 
and rates; and
    (ii) the Copyright Royalty Judges may decline to adopt the 
agreement as a basis for statutory terms and rates for participants 
that are not parties to the agreement, if any participant described 
in clause (i) objects to the agreement and the Copyright Royalty 
Judges conclude, based on the record before them if one exists, that 
the agreement does not provide a reasonable basis for setting 
statutory terms and rates.

17 U.S.C. 801(b)(7)(A). The Judges received seven such proposals and 
published a notice requesting comment on the proposed rates and terms 
contained in the proposals, with certain modifications, submitted by 
the following participants: (1) SESAC and ACE; (2) BMI and ACE; (3) 
ASCAP and ACE; (4) NMPA/HFA and NRBNMLC; (5) SESAC and NRBNMLC; (6) 
ASCAP and NRBNMLC; and (7) BMI and NRBNMLC.\3\ 77 FR 24662 (April 25, 
2012). Comments were due by May 25, 2012.
---------------------------------------------------------------------------

    \3\ On October 31, 2011, EMF notified the Judges that as a 
member of NRBNMLC it was a party to each of the joint proposals 
involving NRBNMLC.

    The Judges received comments from Common Frequency; OpenSky Radio 
Corp.; The Prometheus Radio Project; Wimberley Valley Radio; WKNC-FM; 
and PBS and NPR, jointly. Each comment, except the PBS/NPR comment,\4\ 
opposed certain of the proposed rates as not reasonable as applied to 
them.\5\ The Judges' ability to reject an agreement on the 
reasonableness of the rates and terms proposed therein is constrained 
by statute. Specifically, section 801(b)(7)(A)(ii) precludes the Judges 
from declining to adopt proposed rates and terms on the grounds of 
reasonableness unless a participant to the proceeding objects. None of 
the entities objecting to the proposed rates and terms submitted a 
timely filed petition to participate in this proceeding, and therefore 
none qualifies as a participant to the proceeding. Therefore, having 
received no objections to the reasonableness of the proposed rates and 
terms from a participant to this proceeding, the Copyright Royalty 
Judges are adopting final regulations, as published on April 25, 2012, 
and June 26, 2012, which set the rates and terms for the section 118 
statutory license for the period 2013-2017.\6\
---------------------------------------------------------------------------

    \4\ The PBS/NPR comment opposed the Judges' proposal to remove 
and reserve two sections--specifically Sec.  381.4 and Sec.  381.8, 
which govern performance of musical compositions by PBS, NPR and 
other public broadcasting entities engaged in the activities of 17 
U.S.C. 118(c), and the use of published pictorial, graphic and 
sculptural works in PBS-distributed programs as well as in other 
PBS-distributed programs, respectively--and proposed rates and terms 
for these sections for the 2013-2017 license period. The Judges 
proposed removal of these sections because none of the initial joint 
proposals addressed them. In accordance with 17 U.S.C. 801(b)(7)(A), 
the Judges sought comment on this proposal in a subsequent notice. 
77 FR 38022 (June 26, 2012). Comments were due July 26, 2012; none 
were received.
    \5\ After the comment period, BMI and ASCAP submitted a letter 
to ``clarify'' portions of the joint proposals addressed by the 
comments. See Letter from BMI and ASCAP, dated June 6, 2012. OpenSky 
Radio responded to the BMI/ASCAP letter on July 17, 2012. For the 
reasons set forth above, the Judges need not address these 
submissions.
    \6\ The regulations adopted today no longer require the Judges 
to publish a cost of living adjustment and a revised schedule of 
rates for the ASCAP and BMI repertories in Sec.  381.5. See 37 CFR 
381.5(c)(1)-(2). Such publication still is required for the SESAC 
repertory but not until on or before December 1, 2013. See 37 CFR 
381.5(c)(3), 381.10(a).
---------------------------------------------------------------------------

List of Subjects in 37 CFR Part 381

    Copyright, Music, Radio, Television, Rates.

Final Regulations

    For the reasons set forth in the preamble, the Copyright Royalty 
Judges amend Part 381 to Chapter III of title 37 of the Code of Federal 
Regulations as follows:

PART 381--USE OF CERTAIN COPYRIGHTED WORKS IN CONNECTION WITH 
NONCOMMERCIAL EDUCATIONAL BROADCASTING

0
1. The authority citation for part 381 continues to read as follows:

    Authority: 17 U.S.C. 118, 801(b)(1) and 803.

Sec.  381.1  [Amended]

0
2. Section 381.1 is amended by removing ``2008'' and adding ``2013'' in 
its place and by removing ``2012'' and adding ``2017'' in its place.

0
3. Section 381.4 is amended as follows:
0
a. By revising paragraphs (a)(1) through(8); and
0
b. In paragraph (c), by removing ``2008'' and adding ``2013'' in its 
place, and by removing ``2012'' and adding ``2017'' in its place.
    The revisions read as follows:

Sec.  381.4  Performance of musical compositions by PBS, NPR and other 
public broadcasting entities engaged in the activities set forth in 17 
U.S.C. 118(c).

* * * * *
    (a) Determination of royalty rate.

(1) For performance of such work in a feature presentation
 of PBS:
  2013-2017................................................      $232.18
(2) For performance of such a work as background or theme
 music in a PBS program:
  2013-2017................................................       $58.51
(3) For performance of such a work in a feature
 presentation of a station of PBS:
  2013-2017................................................       $19.84
(4) For performance of such a work as background or theme
 music in a program of a station of PBS:
  2013-2017................................................        $4.18
(5) For the performance of such a work in a feature
 presentation of NPR:
  2013-2017................................................       $23.53
(6) For the performance of such a work as background or
 theme music in an NPR program:
  2013-2017................................................        $5.70
(7) For the performance of such a work in a feature
 presentation of a station of NPR:
  2013-2017................................................        $1.66
(8) For the performance of such a work as background or
 theme music in a program of a station of NPR:
  2013-2017................................................         $.59
 

0
4. Section 381.5 is amended by revising paragraphs (c) and (d) to read 
as follows:

Sec.  381.5  Performance of musical compositions by public broadcasting 
entities licensed to colleges and universities.

* * * * *
    (c) Royalty rate. A public broadcasting entity within the scope of 
this section may perform published nondramatic musical compositions 
subject to the following schedule of royalty rates:
    (1) For all such compositions in the repertory of ASCAP, the 
royalty rates shall be as follows:
    (i)

[[Page 71106]]

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                          Number of full-time students         2013            2014            2015            2016            2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Level 1..............................  or the effective radiated power (ERP) as specified in its 
current FCC license. An exact copy of such declaration shall be 
furnished to each of ASCAP, BMI and SESAC.
* * * * *

0
5. Section 381.6 is amended as follows:
0
a. By removing paragraph (f).
0
b. By redesignating paragraphs (b) through (e) as paragraphs (c) 
through (f), respectively;
0
c. By adding a new paragraph (b);
0
d. By revising newly redesignated paragraphs (d) and (e).
    The additions and revisions to Sec.  381.6 read as follows:

Sec.  381.6  Performance of musical compositions by other public 
broadcasting entities.

* * * * *
    (b) Definitions. As used in paragraphs (d) and (e) of this section, 
the following terms and their variant forms mean the following:
    (1) Feature Music shall mean any performance of a musical work, 
whether live or recorded, that is the principal focus of audience 
attention. Feature Music does not include bridge, background, or 
underscore music, themes or signatures, interstitial music between 
programs such as in public service announcements or program sponsorship 
identifications, brief musical transitions in and out of program 
segments (not to exceed 60 seconds in duration), incidental 
performances of music during broadcasts of public, religious, or sports 
events, or brief performances during news, talk, religious, and sports 
programming of no more than 30 seconds in duration.
    (2) Population Count. The combination of:
    (i) The number of persons estimated to reside within a station's 
Predicted 60 dBu Contour, based on the most recent available census 
data; and
    (ii) The nonduplicative number of persons estimated to reside in 
the Predicted 60 dBu Contour of any Translator or Booster Station that 
extends a public broadcasting entity's signal beyond the contours of a 
station's Predicted 60 dBu Contour.
    (iii) In determining Population Count, a station or a Translator or 
Booster Station may use and report the total population data, from a 
research company generally recognized in the broadcasting industry, for 
the radio market within which the station's community license is 
located.
    (3) Predicted 60 dBu Contour shall be calculated as set forth in 47 
CFR 73.313.
    (4) Talk Format Station shall mean a noncommercial radio station:
    (i) Whose program content primarily consists of talk shows, news 
programs, sports, community affairs or religious sermons (or other non-
music-oriented programming);
    (ii) That performs Feature Music in less than 20% of its 
programming annually; and
    (iii) That performs music-oriented programming for no more than 
four (4) programming hours during the hours from 6 a.m. to 10 p.m. each 
weekday, with no two (2) hours of such

[[Page 71107]]

programming occurring consecutively, with the exception of up to five 
(5) weekdays during the year.
    (5) Weekday shall mean the 24-hour period starting at 12 a.m. 
through 11:59 p.m. on Mondays, Tuesdays, Wednesdays, Thursdays and 
Fridays occurring between January 1 of a given year up to and including 
Thanksgiving day of that year.
    (6) Translator Station and Booster Station shall have the same 
meanings as set forth in 47 CFR 74.1201.
* * * * *
    (d) Royalty rate. A public broadcasting entity within the scope of 
this section may perform published nondramatic musical compositions 
subject to the following schedule of royalty rates:
    (1) For all such compositions in the repertory of ASCAP, the 
royalty rates shall be as follows:
    (i) Music Fees (Stations with 20% or more programming containing 
Feature Music):

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                Population count               2013            2014            2015            2016            2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Level 1..............................  0-249,999........................            $631            $644            $657            $670            $683
Level 2..............................  250,000-499,999..................           1,126           1,149           1,171           1,195           1,219
Level 3..............................  500,000-999,999..................           1,688           1,722           1,756           1,791           1,827
Level 4..............................  1,000,000-1,499,999..............           2,251           2,296           2,342           2,389           2,437
Level 5..............................  1,500,000-1,999,999..............           2,814           2,870           2,928           2,986           3,046
Level 6..............................  2,000,000-2,499,999..............           3,377           3,445           3,513           3,584           3,655
Level 7..............................  2,500,000-2,999,999..............           3,939           4,018           4,098           4,180           4,264
Level 8..............................  3,000,000 and above..............           5,628           5,741           5,855           5,972           6,092
--------------------------------------------------------------------------------------------------------------------------------------------------------

     (ii) Talk Format Station Fees (Stations with =20% Feature Music programming:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                Population count               2013            2014            2015            2016            2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Level 1..............................  0-249,999........................            $138            $140            $143            $146            $149
Level 2..............................  250,000-499,999..................             230             234             239             244             248
Level 3..............................  500,000-999,999..................             345             352             359             366             373
Level 4..............................  1,000,000-1,499,999..............             459             468             478             487             497
Level 5..............................  1,500,000-1,999,999..............             574             586             597             609             622
Level 6..............................  2,000,000-2,499,999..............             689             702             716             731             745
Level 7..............................  2,500,000-2,999,999..............             804             820             836             853             870
Level 8..............................  3,000,000 and above..............           1,149           1,171           1,195           1,219           1,243
--------------------------------------------------------------------------------------------------------------------------------------------------------

     (ii) Talk fees for stations with pre>
```