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| March 3, 2004 | Christopher Chichester
Press Secretary
202-225-4236
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Watch the video clip
Mr. Speaker, our country has worked to support and protect copyright holders to ensure that they receive fair compensation for their creative works.
Over the last twenty years, Congress has attempted to develop the appropriate mechanism to govern royalties; that is, how to distribute royalties to those who create and how to adjust royalties when necessary. In other words, we have tried to find a compromise that allows for the fair distribution of royalties when two parties can’t agree on the value of a creative work.
When I say “fair distribution of royalties” that could mean many things to different parties, particularly the creators of copyrighted works. It is a major reason why this issue is again before Congress.
Congress established the first entity to deal with this in 1976. Ten years ago, that system was abolished to create the current Copyright Arbitration Royalty Panel, or CARP, system.
This legislation that I authored addresses the main problem: frivolous royalty claims, which is a growing trend, as well as decisions made by the Copyright Panel that are unpredictable and inconsistent.
Much like another intellectual property rights bill that reforms the Patent and Trademark Office, this legislation is critical to the entertainment industry and a growing economy.
It is of great importance to artists, songwriters, music publishers and webcasters. For example, take the case of a songwriter and a web caster.
If a songwriter can’t reach an agreement with a webcaster about the value of a song in the marketplace, the matter is brought to the copyright royalty and distribution system. The private parties involved pay for the process.
What happens now is songwriters are not left with much of a royalty payment because the process is too lengthy and too costly. If the songwriter cannot make enough money from his creations to support himself, then he will no longer be able to create and our economy and our society will be the loser.
This is the central reason why we are here today: to ensure that the songwriter has the incentive to create and the webcaster has the benefit of distributing enjoyable musical creations.
Unfortunately, American songwriters and web casters today are caught up in a royalty system that is anything but fair. The current proceedings to establish royalty rates are long, laborious and costly.
They harm our economy and take a tremendous toll on the businesses and persons involved. Congress must reform this broken system, which is exactly what this bill does.
I urge my colleagues to support a balanced and fair process that will, for example, help songwriters and bring a little more melody into the lives of the American people.
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Congressman Smith is the Chairman of Courts, the Internet and Intellectual Property Subcommittee of the House Judiciary Committee. Read more about Congressman Smith's positions on high technology.
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