WASHINGTON, DC -- NAB President and CEO David K. Rehr delivered the following oral testimony before the United States House of Representatives Committee On The Judiciary. The hearing was entitled "Copyright Licensing in a Digital Age: Competition, Compensation and the Need to Update the Cable and Satellite TV Licenses."
Following is a transcript of Rehr's oral testimony as prepared:
Chairman Conyers, Ranking Member Smith, and members of the Committee, thank you very much for having me here today.
My name is David Rehr, and I serve as the President and CEO of the National Association of Broadcasters.
The NAB proudly represents over 8,300 diverse television and radio stations across the United States employing nearly 250,000 hard working Americans.
Our member companies keep their communities informed and connected. We work every day to embody the spirit of localism, which Congress has embraced and affirmed time and time again as a vital public policy goal. We do not charge our viewers to watch our programming; we rely on payments from advertisers to deliver a free service to your constituents. Without free, over-the-air television pay TV models would be unrestrained in their ability to maximize their profitability.
Broadcast television stations remain the primary source of the most diverse and popular entertainment, news, weather, and sports programming in the country. In fact, according to data from Nielsen Media research, in the 2007-2008 television season, 488 of the top, most watched, 500 primetime television programs were broadcast over-the-air. While these stations represent a relatively small number of channels on pay systems, broadcasters offer a unique and valuable service to their local markets and your viewers.
I would like to make two points:
1. Localism must remain central to any policy deliberations with respect to satellite and/or cable compulsory licenses.
2. The Copyright Office recommendations must be evaluated individually for both intended and unintended consequences.
Starting with my first point:
1. Localism must remain central to any policy deliberations with respect to satellite and/or cable compulsory licenses.
Unlike other countries that offer only national television channels, the United States has succeeded in creating a rich and varied mix of local television service providers so more than 200 communities - including towns as small as Glendive, Montanta, which has fewer than 4,000 television households - can have their own voices. This is the genius of the American system and should be celebrated.
The pillars of this system are the availability of signals to viewers throughout the market and the ability to offer exclusive programming in that market, often through a network-affiliate relationship.
We urge this committee to view any changes through the prism of localism and the core principles of localism.
2. The Copyright Office recommendations must be evaluated individually for both intended and unintended consequences.
Broadcasters and Cable have been working under the cable compulsory license for over thirty years and by and large, that system has worked well.
The experience under the Satellite compulsory licenses has been more challenging.
Here are a few reactions to some of the report's recommendations:
We agree with the Office on the retention of a "local into local" compulsory license.
We agree with the Office on its call for phasing out of the "distant signal" license for satellite providers. Beyond that, in fact, Broadcasters believe that the license should be replaced with a requirement for local-into-local carriage in all television markets. There are 31 of the 210 television markets in small and rural areas - that the satellite companies do not serve. The satellite companies have said that this is a capacity issue, yet it is more likely a simple a business decision.
Broadcasters have invested well over a billion dollars in making the transition to digital television. So far there is very little economic return on that investment. Nevertheless, those investments are still in the public interest. A satellite industry investment in providing local into local services to all Americans would also be in public interest.
I am certain that if Congress does not step in, local service will never be provided.
We disagree with the Copyright Office on the recommendations to "harmonize" cable and satellite licenses. They have different business models, different technologies, and different evolutions. We are unsure of all the unintended consequences particularly in this difficult economic climate.
We share the concerns of the copyright office as expressed in their report regarding compulsory licenses to permit retransmission of broadcaster signals on the Internet as well as the requirements they would impose.
As you know, and have heard here today, the reauthorization is complicated, yet extremely important to American television viewers.
The underlying principle or focus which I encourage this committee to use as its guide in its deliberations is localism. Localism continues to provide Americans a connection to their communities.
Thank you for giving me the opportunity to testify. I welcome any questions you may have.
About NAB
The National Association of Broadcasters is the premier advocacy association for America's broadcasters. As the voice of more than 8,300 radio and television stations, NAB advances their interests in legislative, regulatory and public affairs. Through advocacy, education and innovation, NAB enables broadcasters to best serve their communities, strengthen their businesses and seize new opportunities in the digital age. Learn more at www.nab.org.
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