[Congressional Record Volume 144, Number 144 (Monday, October 12, 1998)]
[Senate]
[Pages S12375-S12377]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




HOUSE-PASSAGE OF THE DIGITAL MILLENNIUM COPYRIGHT ACT CONFERENCE REPORT

  Mr. HATCH. Mr. President, last Thursday the Senate approved, by 
unanimous consent, the conference report on H.R. 2281, the Digital 
Millennium Copyright Act (DMCA). I rise today to laud the House's 
action in adding its vote of approval to that of the Senate. The bill 
now goes to the President, who I expect will move

[[Page S12376]]

swiftly to sign this important legislation into law.
  As I said last Thursday, and on many other occasions, I believe the 
DMCA is one of the most important pieces of legislation to be 
considered by Congress this year, even in recent memory. It has been 
over twenty years since such significant copyright law reforms have 
been enacted in this country, and this vote has come at a critical 
juncture in our nation's transition to a ``digital millennium.''
  But all this would not have happened without the critical support of 
countless parties who have come together in negotiations to refine the 
bill and reach a compromise that best promotes American interests at 
home and abroad. Once again, I want to thank all of the conferees who 
participated in bringing this legislation to closure.
  In particular, I want to recognize the efforts of my counterparts on 
the Senate side, Senator Leahy and Senator Thurmond. I also want to 
convey my appreciation for the dedicated efforts of Congressman Henry 
Hyde, the distinguished Chairman of the House Judiciary Committee, 
Congressman John Conyers, the distinguished Ranking Member of the House 
Judiciary Committee, and Congressman Howard Coble, the distinguished 
Chairman of the House Subcommittee on Courts and Intellectual Property. 
They have been committed to seeing this bill through from the start and 
have been wholly undeterred by other pressing business that has 
occupied the House Judiciary Committee in recent weeks. I also want to 
recognize Congressman Tom Bliley, the distinguished Chairman of the 
Commerce Committee, for his willingness to consider the Senate's views 
objectively and dispassionately.
  In addition, I want to acknowledge once again the hard work done by 
staff. In particular I want to recognize the efforts of Manus Cooney, 
Edward Damich, and Troy Dow of my staff, whose long hours and tireless 
efforts were key to guiding this bill through every stage of the 
legislative process. Bruce Cohen, Beryl Howell, and Marla Grossman, of 
Senator Leahy's staff, likewise provided invaluable assistance on all 
levels. I also want to thank Garry Malphrus of Senator Thurmond's staff 
for his work in conference, as well as Paul Clement and Bartlett 
Cleland of Senator Ashcroft's staff for their invaluable assistance in 
reaching key compromises in the Judiciary Committee. Finally, I want to 
thank the House staff, including Mitch Glazier, Debra Laman, Robert 
Raben, David Lehman, Bari Schwartz, Justin Lilley, Andrew Levin, Mike 
O'Rielly, and Whitney Fox.
  I also want to recognize the long hours and persistent dedication of 
the many people who engaged in hard-fought, but ultimately fruitful, 
private-sector negotiations on related issues. Many of the compromises 
embodied in this legislation would not have been reached without the 
support of these parties. For example, we would not be lauding the 
passage of a bill today at all were it not for the willingness of the 
copyright industries, Internet service providers, educators, libraries, 
and others in the fair use community to come together at the direction 
and under the supervision of the Judiciary Committee to arrive at a 
consensus position regarding standards for limiting the copyright 
infringement liability of Internet service providers.
  Many other negotiations were conducted and agreements reached that 
made this legislation possible, including agreements between copyright 
owners and manufacturers of the consumer electronics devices that make 
the use of their works by the public possible. One such agreement 
reflects the understanding of the motion picture industry and consumer 
electronics manufacturers regarding standards for the incorporation of 
certain copyright protection technologies in analog videocassette 
recorders. This agreement was the basis for the new section 1201(k) of 
the Copyright Act, as added by the DMCA, which requires analog 
videocassette recorders to accommodate specific copy control 
technologies in wide use in the market today. I have received a letter 
from Mr. William A. Krepick, President and Chief Operating Officer of 
Macrovision Corporation--the producer of such copy protection 
technology--assuring me of his commitment to adhere to the spirit of 
this agreement by making such technology available on reasonable and 
nondiscriminatory terms, which in some circumstances will include 
royalty-free licenses. I would ask unanimous consent that the text of 
this letter be incorporated in the Record immediately after my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See Exhibit 1.)
  Mr. HATCH. Mr. President, the DMCA is a remarkable bill that is the 
result of a remarkable process. By enacting this legislation in a 
timely fashion, the United States has set the marker for the rest of 
the world with respect to the implementation of the new WIPO treaties. 
As a result, the United States can look forward to stronger world-wide 
protection of our intellectual property and a stronger balance of trade 
as inbound revenues from foreign uses of our intellectual property 
continue to increase. I am pleased to have been a part of this great 
effort, and I look forward to the President's signing of H.R. 2281.

                               Exhibit 1


                                      Macrovision Corporation,

                                   Sunnyvale, CA, October 7, 1998.
     Hon. Orrin Hatch,
     Chairman, Committee on the Judiciary, U.S. Senate, 
         Washington, DC.
       Dear Chairman Hatch: I am writing this letter to you in 
     your capacity as Chairman of the Senate-House Conference 
     Committee on the Digital Millennium Copyright Act of 1998. We 
     understand that the Conference Committee is prepared to 
     include in the final legislation to be reported to the Senate 
     and House of Representatives a provision that requires that 
     analog videocassette recorders manufactured and/or sold in 
     the United States must conform to two analog copy control 
     technologies certain aspects of which are proprietary to 
     Macrovision Corporation. As you may know, Macrovision 
     Corporation has been in business for 15 years providing 
     various copy control technologies to help copyright owners 
     protect their valuable intellectual property. We license 
     various technologies to hardware manufacturers, including 
     manufacturers of consumer electronics and various computer-
     based products, and to Hollywood movie studios and other 
     independent video producers.
       We are a small company and have worked very hard over the 
     past two-and-a-half years to demonstrate to the consumer 
     electronics, computer, and motion picture companies and 
     industries that our copy control technologies offer the best 
     solution to digital-to-analog copy protection for the DVD 
     format, as well as in its traditional analog videocassette 
     application. We have worked with the companies and industries 
     to ensure that compatability and effectiveness are assured, 
     and, as a result, our technologies have been required for use 
     to provide protection of the analog outputs of DVD playback 
     devices implementing the two encryption-based copy protection 
     systems now in the market--the Content Scramble System (CSS) 
     and DIVX.
       We support the legislative proposals that are being 
     considered by the Conference Committee, in the form of 
     Subsection ``k'' and its corresponding legislative history as 
     attached to this letter. We also recognize the unique 
     position that such legislation provides to our technology and 
     our company. Accordingly, we are writing to assure you and 
     your colleagues on the Conference Committee that we will not 
     abuse our position in our licenses for the technologies for 
     which responses are being required by this legislation. 
     Specifically, we are willing to assure you and the Committee 
     that any licenses that may be necessary to implement these 
     technologies will be offered on reasonable and non-
     discriminatory terms, as that phrase is commonly used and 
     understood in industry standards processes. We will modify 
     certain terms and conditions of our baseline analog copy 
     control license agreements--and offer the same modifications 
     to existing licensees--if this legislation is enacted in 
     order to eliminate our contractual requirements that analog 
     videocassette recorders manufactured in or sold in the United 
     States respond to our technologies and that certain display 
     device manufacturers ensure that their products are 
     compatible with our technologies, in the sense of not 
     displaying visible artifacts or distortions in the authorized 
     playback of material protected using our analog copy control 
     technologies. The first of these requirements will now be the 
     subject of the statutory requirement that is the subject of 
     the legislative provision.
       The second requirement will now be the subject of an inter-
     industry forum on compatability issues, that will afford all 
     interested parties an opportunity to work together to resolve 
     such issues as they arise. We hasten to add that we do not 
     expect such problems to arise, since our technologies have 
     been proven to the satisfaction of the manufacturers that 
     they do not cause problems, and we do not expect to make any 
     material modifications to them in the future. Manufacturers 
     already know what the technologies are and can test their 
     products before finalizing their design. We commit to you and 
     your colleagues that any changes that are made to our 
     technologies will be the result of inter and intra industry 
     consensus on the changes before they are made. Nevertheless, 
     in order to reassure everyone involved, we are prepared to 
     cooperate in the

[[Page S12377]]

     inter-industry forum that is being established. We have been 
     assured that this forum will be established within six months 
     after passage of this legislation and will include equal 
     representation from the consumer electronics, computer, and 
     movie studio industries.
       With regard to our licensing terms, we commit to you and 
     your colleagues that we will from the date of enactment 
     adhere to the following points--which are essentially 
     reflective of our current licensing policies. First, as 
     stated above, our proprietary analog copy protection 
     technology will be offered on reasonable and non-
     discriminatory terms, as that phrase is used in the normal 
     industry parlance. Second, in relation to certain specific 
     circumstances:
       (a) Manufacturers of consumer-grade analog VHS and 8mm 
     analog video cassette recorders/camcorders that are required 
     by the legislation to conform to our proprietary analog copy 
     protection technologies (and any new format analog 
     videocassette recorder that is covered by paragraph (1)(A)(v) 
     of the legislation and thereby required to conform to our 
     proprietary analog copy control technologies) will be 
     provided royalty-free licenses for the use of our relevant 
     intellectual property in any device that plays back packaged, 
     prerecorded content, or that reads and responds to or 
     generates or carries forward the elements of these 
     technologies associated with such content;
       (b) In the same circumstances as described in (a), other 
     manufacturers of devices that generate, carry forward, and/or 
     read and respond to the elements of these technologies will 
     be provided with licenses carrying only modest fees (in the 
     current dollar range of $25,000 initial payment and lesser 
     amounts as recurring annual fees);
       (c) Manufacturers of other products, including set-top-
     boxes and other devices that perform similar functions 
     (including integrated devices containing such functionality), 
     will be provided with licenses on reasonable and non-
     discriminatory terms, including royalty and other 
     considerations.
       In the absence of the specific attached legislative and 
     explanatory language, Macrovision would not have made the 
     above referenced commitments regarding our licensing terms 
     and our contract clauses on VCR responsiveness and 
     playability issues. We very much appreciate the work of you 
     and your colleagues in helping to draft and, hopefully, 
     ultimately enact this legislation. We also appreciate and 
     acknowledge the leadership and cooperation of certain 
     companies and individuals in getting this proposal to this 
     point.
       I understand that this letter will be incorporated into the 
     official report of the Conference Committee and that the 
     Conferees are relying on our representation herein. If you or 
     other members of the Conference have any questions or need 
     any clarification on any point, please do not hesitate to 
     contact me, or have one of your staff contact me.
           Sincerely,
                                               William A. Krepick,
     President/COO.

                          ____________________