Today, Congressman Jerrold Nadler (NY-10), the Ranking Member of the House Judiciary Subcommittee on Courts, Intellectual Property and the Internet, delivered a statement at the Judiciary Committee’s markup of “The Satellite Television Access Reauthorization Act of 2014.”

“The dramatic recent changes in marketplace dynamics, as well as technological advances that continue to revolutionize ways of distributing video programming content, raise legitimate questions about whether the statutory licensing system in the Copyright Act is still needed,” said Rep. Nadler. “I nonetheless support this clean five-year reauthorization because it will ensure that consumers who are receiving service by virtue of the Section 119 license retain that service when the agreements providing for that service expire at the end of the year.”

The following is the full text of Congressman Nadler’s statement (as prepared for delivery):

            “I support H.R. 5036, ‘The Satellite Television Access Reauthorization Act of 2014,’ which renews for another five years the statutory license that allows satellite providers to retransmit distant signals into a local broadcast area in certain circumstances. 

            “Of the three statutory licenses in the Copyright Act, only the satellite distant-into-local license contained in Section 119 is set to sunset on December 31st of this year.  Among other things, that license allows satellite carriers to provide an out-of-market station to customers who are not served by local television broadcasts.  The other two licenses – Section 111 for cable providers and Section 122 for satellite retransmission of local broadcast programming in local markets – are not set to expire.      

            “Enacted in 1988, when the satellite industry was in its infancy, the Section 119 license was intended to foster competition with the cable industry and also to increase service to ‘unserved households’ -- those subscribers who cannot receive an over-the-air signal of a local network.  In 2010, as was the case on three prior occasions, Congress extended the Section 119 license for another five years as part of the Satellite Television Extension and Localism Act of 2010 (‘STELA’).

            “In granting cable and satellite providers the statutory right to retransmit copyrighted content at a government-regulated rate through Sections 111, 119, and 122 of the Copyright Act, Congress created an exception to the general rule that creators have exclusive rights to their works – including the right to determine when and how to distribute them.  This licensing system replaces the free market, something that we are generally reluctant to do.  And when we did so for cable and satellite providers, these industries were just starting up, and the licenses were intended to encourage growth, foster competition, and enhance customer access.    

            “On these fronts, the system has been a tremendous success. It is estimated that nearly 90 % of American households now subscribe to a pay-TV service provided by multichannel video programming distributors – in most cases cable or satellite operators.  And nearly all households have a choice of at least three different providers. 

            “Nonetheless, the dramatic recent changes in marketplace dynamics, as well as technological advances that continue to revolutionize ways of distributing video programming content, raise legitimate questions about whether the statutory licensing system in the Copyright Act is still needed.

            “This is not a new question.  It is one that we have continued to grapple with when faced with the possible sunset of Section 119, including during the hearings that the Subcommittee on Courts, Intellectual Property and the Internet held in May and last September on the Copyright Act’s cable and satellite licensing scheme. 

            “This bill does not address the overarching licensing system, but we should continue to explore that as part of the Committee’s ongoing comprehensive copyright review.  In the meantime, however, I support this five-year reauthorization of the Section 119 distant-into-local satellite license.  We still need answers as to how many households would actually lose one or more of the four major network channels if Section 119 were not renewed.   I nonetheless support this clean five-year reauthorization because it will ensure that consumers who are receiving service by virtue of the Section 119 license retain that service when the agreements providing for that service expire at the end of the year. 

            “Other issues were raised by witnesses at our hearings – including, as I’ve noted, the possible phase-out of the licenses altogether, as well as issues that arise during retransmission consent negotiations.   There was no consensus reached on how this Committee, acting within its jurisdiction, should address these issues.  I am therefore pleased that this reauthorization does not reach beyond the renewal of the Section 119 license.

            “I therefore urge my colleagues to join me in voting for H.R. 5036 and yield back the balance of my time.”

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