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its obituary, it is organizing a Jukebox Promotion Committee to emphasize the value of coin-operated music.

Surely, with that

recognition must also come a recognition that the music used in the jukeboxes supplies the reason-for-being of the jukeboxes, and the free market is the proper place to assess the value of that

music.

BMI has not changed its longstanding objection to the concept of the compulsory license. Jukebox operators make their money from only one thing, their ability to use the music of the people we represent. The cost of that product should be set by the marketplace and not the Tribunal. In spite of our protestations, Congress, in its wisdom, decided to give the industry the compulsory license.

That decision, however, did not diminish the complaints. Urged by you, Mr. Chairman, the jukebox industry and the performing rights organizations met in an attempt to settle their differences. They wer were successful and came up with a

voluntary agreement that has now been in force for nearly three years. The Jukebox Administration Committee, formed as part of that agreement, has periodic meetings, keeping the two sides in continual dialogue. BMI will always prefer free market licensing, but given the realities of the time, and the importance for the entire creative community, music and non-music, of our joining Berne, we feel a compromise solution is the only acceptable one and believe that your Section 8 constitutes the minimum amount of change that can be accomplished with regard to the jukebox compulsory license and still adhere to the spirit of the Convention.

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BMI will not be a part of any attempt to license the jukebox industry out of existence. It is in the interest of the

performing rights organizations to keep open as many channels as possible where music is performed, and jukeboxes are a significant one. The jukebox industry should understand that, too, and recognize that this bill accommodates the interests of us both. There has never been a better climate in this country for our joining Berne than now. We urge Congress not to let the opposition of AMOA prevent the passage of this important legislation.

The cries of the jukebox industry that they would be put out of businesss were loud when the 1976 Copyright Law was being rewritten. The industry still exists. Their cries of doom, in fact, go back more than a quarter century and

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mark the longest, and still running, death scene on

Don't let them now persuade you to drop our commitment to Berne. The industry will still be there long afterwards. I point

out to the subcommittee that the January 24, 1988 issue of the New York Sunday News noted that in 1984, after the last round of AMOA cost complaints,

"Variety, among other publications, began printing jukebox obits.

But funny a thing happened. The patient didn't die. The number of boxes has held pretty much steady in the '80s. Wurlitzer went back into the business.... Five major jukebox companies are busy making models that incorporate laservideos, CDs and state-of-the-art sound. In 1986, jukebox operators bought approximately half of the 93 million 45 rpm records sold in the U.S."

Simply stated, the benefits to the American copyright community

are far too great to bypass this opportunity to join the Convention because of yet another unfounded cost argument.

Although BMI would prefer no compulsory licensing at all and

the jukebox operators would prefer the compulsory license to stay as is, Section 3 of this bill faces the practical and political realities. It strikes the proper balance with regard to jukebox licensing between the minimum changes necessary to U.S. law and the needs of users and creators of jukebox-performed music. BMI supports adoption of this Section and looks forward to the U.S. becoming a full-fledged member of the world copyright community.

In addition, Mr. Chairman, BMI subscribes to the July 2, 1987 Statement of the NCBC in calling for the minimum amount of change to U.S. Copyright Law necessary to gain admission to the Berne Convention. In that regard, we adopt the NCBC position that the moral rights provisions of H.R. 1263 are unnecessary, because the body of U.S. law as it currently exists provides sufficient protection for the moral rights mandated by Berne.

We

On the subject of formalities, we also support the NCBC position advocating repeal of Section 411 of the Copyright Law entitled "Registration as prerequisite to infringement suit." believe that we cannot adhere to Berne without doing so, since, in our view, that section puts an impermissible formality on works of foreign origin by requiring them to be registered before any infringement suit can be brought. In most cases, the incentive to register would remain even after a repeal of Section 411, because

under Section 412, entitled "Registration as prerequisite to certain remedies for infringement," statutory damages and attorneys' fees would be lost. This is a compelling enough reason to continue to register. In infringement actions brought by BMI, for example, a monetary remedy other than statutory damages is just not viable, and that, in itself, is sufficent reason for us to continue to register, even without the compulsion of Section

411.

Thank you for this opportunity to testify. I will now be happy to answer any questions.

Mr. KASTENMEIER. Thank you, Mr. Ahrold, that was a very precise statement.

Now, I would like to call the last witness on this panel, Mr. Walter Bohrer, who is president of the Amusement and Music Operators Association.

Mr. BOHRER. Thank you. Mr. Chairman and Members of this Committee, I am Walter Bohrer, president of the Hastings Distribution Company of Milwaukee, Wisconsin and of the Amusement and Music Operations Association. With me is Robert Wilbur, director of our Washington office.

First, Mr. Chairman, we want to thank you for holding this hearing on a unique part of copyright law-the jukebox compulsory license-and the effect on the U.S. jukebox industry of ratification of the Berne Convention. We also thank you for introducing last week House Joint Resolution 446 in honor of the 100th anniversary of the jukebox, authorizing and requesting the President of the United States to declare the week of October 30-November 5 as National Jukebox week.

In 1889, Louis Glass fitted a coin slot on a wax cylinder Edison machine and placed it in the Palais Royale saloon in San Francisco. Ever since, the jukebox has been one of the most popular means of bringing musical expression to our people, wherever we gather to relax, share our experiences, and take pride in our musical and cultural diversity. Before the radio and far before the age of television, the jukebox became the means by which the musical compositions of our authors and their recorded performances became known to the American people. How many songs and compositions which would otherwise have passed unknown have achieved popularity through the jukebox? This is an important part of our American heritage which must be recognized under U.S. adherence to Berne-if adherence to Berne is what the Congress decides-and certainly under any revisions in U.S. laws which this committee makes to render our laws consistent with Berne.

Unfortunately, the jukebox industry is already an industry under siege. The number of jukeboxes has declined and is continuing to decline. Also-and this should be of particular interest to the performing rights societies, we are seeing a shift from jukeboxes owned and operated by companies, such as AMOA members, which specialize in this part of the entertainment industry, to jukeboxes owned and operated by the individual establishment. Through the promotion of National Jukebox Week, with support from the producers of recorded music, the many performers who understand the importance of the jukebox, and our friends in the performing rights societies, we hope to reverse this declining trend.

With these concerns in mind, we have carefully followed the debate over the last several years on adherence to the Berne Convention. The Ad Hoc Working Group on U.S. Adherence to the Berne Convention-a non-governmental group convened by the U.S. State Department-concluded that U.S. law on the jukebox compulsory license was "probably" incompatible with the Convention with respect to works of foreign origin. It is important to note that U.S. adherence to the Berne Convention could not in any way affect the copyright laws pertaining to musical works of U.Š. origin. Whatever the complexities may be in making U.S. law com

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