[Congressional Record Volume 153, Number 194 (Tuesday, December 18, 2007)]
[Senate]
[Pages S15917-S15919]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LEAHY (for himself, Mr. Hatch, Mrs. Feinstein, and Mr. 
        Corker):
  S. 2500. A bill to provide fair compensation to artists for use of 
their sound recordings; to the Committee on the Judiciary.
  Mr. LEAHY. Mr. Presdient, today, Senator Hatch and I are, once again, 
introducing important intellectual property legislation together. We 
are introducing the Performance Rights Act of 2007 for a very simple 
and clear reason: artists should be compensated fairly for the use of 
their work.
  I am an avid music fan. Music entertains, enlightens, and inspires 
us. Much of the music enjoyed by most Americans, including myself, was 
first heard on traditional, over-the-air radio. There is no question 
that radio play promotes artists and their sound recordings; there is 
also no doubt that radio stations profit directly from playing the 
artists' recordings.
  When radio stations broadcast music, listeners are enjoying the 
intellectual property of two creative artists the songwriter and the 
performer. The success, and the artistic quality, of any recorded song 
depends on both. Radio stations pay songwriters for a license to 
broadcast the music they have composed. That is proper, and that is 
fair. The songwriters' work is promoted by the air play, but no one 
seriously questions that the songwriter should be paid for the use of 
his or her work.
  But the performing artist is not paid by the radio station. The time 
has come to end this inequity. Its historical justification has been 
overtaken by technological change; the economics of the radio industry 
of years past has been superseded by entirely new business models. 
Webcasters compensate performing artists, satellite radio compensates 
performing artists, and cable companies compensate performing artists; 
only terrestrial broadcasters still do not pay for the use of sound 
recordings. Artists should have the same rights regardless of whether 
it is a terrestrial broadcaster or a webcaster using and profiting from 
their work. Radio play may have promotional value to the artist, but 
there

[[Page S15918]]

is a property right in the sound recording, and those that create the 
content should be compensated for its use.
  In ensuring artists are compensated, two other principles important 
to me are reflected in this legislation. First, noncommercial and small 
commercial radio stations should be nurtured, and not threatened by a 
change in the law. Second, songwriters, who now are, as they should be, 
paid for use of their work should not have their rights diminished in 
any way.
  The legislation we introduce today on a bipartisan basis, along with 
companion bipartisan legislation being introduced today in the House of 
Representatives, provides that artists will be compensated by 
broadcasters for the use of their work. Noncommercial stations--from 
Vermont Public Radio which broadcasts ``Saturday Afternoon at the 
Opera,'' to the campus radio station at St. Michael's college that 
plays ``Those Monday Blues'' and ``The Odds and Evens Jazz Show''--have 
a different mission than commercial stations, and therefore need a 
different status, one that will subject the stations only to a nominal 
flat fee for use of sound recordings. Commercial radio stations that 
have a revenue under $1.25 million, which comprises roughly three-
fourths of all music radio stations, will also have a flat fee option.
  Traditional, over-the-air radio remains vital to the vibrancy of our 
music culture, and I want to continue to see it prosper as it 
transitions to digital. But I also want to ensure that the performing 
artist the one whose sound recordings drive the success of broadcast 
radio is fairly compensated.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2500

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Performance Rights Act''.

     SEC. 2. EQUITABLE TREATMENT FOR TERRESTRIAL BROADCASTS.

       (a) Performance Right Applicable to Radio Transmissions 
     Generally.--Section 106(6) of title 17, United States Code, 
     is amended to read as follows:
       ``(6) in the case of sound recordings, to perform the 
     copyrighted work publicly by means of an audio 
     transmission.''.
       (b) Inclusion of Terrestrial Broadcasts in Existing 
     Performance Right.--Section 114(d)(1) of title 17, United 
     States Code, is amended--
       (1) in the matter preceding subparagraph (A), by striking 
     ``a digital'' and inserting ``an''; and
       (2) by striking subparagraph (A).
       (c) Inclusion of Terrestrial Broadcasts in Existing 
     Statutory License System.--Section 114(j)(6) of title 17, 
     United States Code, is amended by striking ``digital''.
       (d) Eliminating Regulatory Burdens for Terrestrial 
     Broadcast Stations.--Section 114(d)(2) is amended in the 
     matter preceding subparagraph (A) by striking ``subsection 
     (f) if'' and inserting ``subsection (f) if, other than for a 
     nonsubscription and noninteractive broadcast transmission,''.

     SEC. 3. SPECIAL TREATMENT FOR SMALL, NONCOMMERCIAL, 
                   EDUCATIONAL, AND RELIGIOUS STATIONS AND CERTAIN 
                   USES.

       (a) Small, Noncommercial, Educational, and Religious Radio 
     Stations.--
       (1) In general.--Section 114(f)(2) of title 17, United 
     States Code, is amended by adding at the end the following:
       ``(D) Notwithstanding the provisions of subparagraphs (A) 
     through (C), each individual terrestrial broadcast station 
     that has gross revenues in any calendar year of less than 
     $1,250,000 may elect to pay for its over-the-air 
     nonsubscription broadcast transmissions a royalty fee of 
     $5,000 per year, in lieu of the amount such station would 
     otherwise be required to pay under this paragraph. Such 
     royalty fee shall not be taken into account in determining 
     royalty rates in a proceeding under chapter 8, or in any 
     other administrative, judicial, or other Federal Government 
     proceeding.
       ``(E) Notwithstanding the provisions of subparagraphs (A) 
     through (C), each individual terrestrial broadcast station 
     that is a public broadcasting entity as defined in section 
     118(f) may elect to pay for its over-the-air nonsubscription 
     broadcast transmissions a royalty fee of $1,000 per year, in 
     lieu of the amount such station would otherwise be required 
     to pay under this paragraph. Such royalty fee shall not be 
     taken into account in determining royalty rates in a 
     proceeding under chapter 8, or in any other administrative, 
     judicial, or other Federal Government proceeding.''.
       (2) Payment date.--A payment under subparagraph (D) or (E) 
     of section 114(f)(2) of title 17, United States Code, as 
     added by paragraph (1), shall not be due until the due date 
     of the first royalty payments for nonsubscription broadcast 
     transmissions that are determined, after the date of the 
     enactment of this Act, under such section 114(f)(2) by reason 
     of the amendment made by section 2(b)(2) of this Act.
       (b) Transmission of Religious Services; Incidental Uses of 
     Music.--Section 114(d)(1) of title 17, United States Code, as 
     amended by section 2(b), is further amended by inserting the 
     following before subparagraph (B):
       ``(A) an eligible nonsubscription transmission of--
       ``(i) services at a place of worship or other religious 
     assembly; and
       ``(ii) an incidental use of a musical sound recording;''.

     SEC. 4. AVAILABILITY OF PER PROGRAM LICENSE.

       Section 114(f)(2)(B) of title 17, United States Code, is 
     amended by inserting after the second sentence the following 
     new sentence: ``Such rates and terms shall include a per 
     program license option for terrestrial broadcast stations 
     that make limited feature uses of sound recordings.''.

     SEC. 5. NO HARMFUL EFFECTS ON SONGWRITERS.

       (a) Preservation of Royalties on Underlying Works.--Section 
     114(i) of title 17, United States Code, is amended in the 
     second sentence by striking ``It is the intent of Congress 
     that royalties'' and inserting ``Royalties''.
       (b) Public Performance Rights and Royalties.--Nothing in 
     this Act shall adversely affect in any respect the public 
     performance rights of or royalties payable to songwriters or 
     copyright owners of musical works.

  Mr. HATCH. Mr. President, I rise today to express my support for the 
Performance Rights Act of 2007, S. 2500, introduced today by Judiciary 
Committee chairman Patrick Leahy and myself. There is no doubt the 
subject of performance rights is important and deserves the Senate's 
attention.
  I recognize that there is no easy solution to the performance rights 
issue because it is a complex area of the law. However, I believe the 
time has come for Congress to begin the process of balancing the 
interests of all involved and forging a fair and reasonable compromise.
  I have had the opportunity to get to know some of the finest and 
talented individuals this country has to offer. Some are under the 
wrong impression that artists in the music industry are making a 
fortune, but they are not aware that all too often it is a struggle to 
survive for the overwhelming majority of them in the cut-throat music 
industry.
  By amending sections 106 and 114 of the Copyright Act, the 
Performance Rights Act of 2007 would apply the performance right in a 
sound recording to all audio transmissions thereby removing the 
exemption on paying performance royalties currently in place for over-
the-air broadcasters.
  The legislation also provides for a blanket license of $5,000 for 
small commercial broadcasters whose gross revenues do not exceed $1.25 
million a year. In addition, noncommercial broadcasters as defined by 
section 118 of the Copyright Act, such as public, educational and 
religious stations would have a blanket license of $1,000 per year. No 
payment would be due until the Copyright Royalty Board determines the 
rates for large commercial broadcasters. The proposed language provides 
that sound recordings used only incidentally by a broadcaster and sound 
recordings used in the transmission of a religious service are exempt.
  S. 2500 further includes a per program license option for terrestrial 
broadcast stations that make limited feature uses of sound recordings. 
Finally, the legislation strengthens the provision in section 114 that 
preserves the rights of songwriters and clarifies that nothing in the 
Performance Rights Act of 2007 shall adversely affect the public 
performance rights of songwriters or copyright owners of musical works.
  I believe in the legislative process and hope that concerns raised by 
interested parties can be resolved in a fair and equitable manner. I do 
not have an ax to grind, nor do I want to hurt any industry. To my 
friends in the broadcasting community, let me say that I am acutely 
aware of your circumstances and concerns, and I cannot stress enough 
that my primary goal is to make sure that Congress handles this in the 
most even-handed way. Let me also stress that I look upon creating a 
performance right in a sound recording to all audio transmissions as 
the first step in addressing some of the major issues affecting the 
music industry. And I look forward to working closely with Chairman 
Leahy and my

[[Page S15919]]

colleagues in carefully considering what additional measures are 
needed.
                                 ______