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Music Online Competition Act of 2001 Translation - Part 2

My apologies for the dryness, but I feel that this legislation may have 
made this way partially to discourage examination.  Part 2 follows:

>"(2) ROYALTY FEES. --
>Any person who obtains a compulsory license under this section shall --
>"(A) pay royalty fees in accordance with subsection (c); or "(B) if such
royalty fees have not been determined, agree to pay such royalty fees as
shall be determined in accordance with subsection (c).";

See the percentages above (45, 2.5, 2.5, 50).  If they've not been
determined - this allows for those not registering the material with the
Copyright office - the fees will be decided, most probably at additional
legal cost to you, the owner/artist.

>Section 115(c) of title 17, United States Code, is amended --

>(1) in paragraph (3) --
>(A) in subparagraph (C) by striking "and (ii)" and inserting "(ii) limited
digital phono record deliveries, and (iii)"

redefines "recordings" to include all digital delivery.

>"In setting royalty rates and terms for limited digital phonorecord
deliveries under this section, the copyright arbitration royalty panel also
shall consider the limitations imposed upon the use of the limited digital
phonorecord delivery by a transmission recipient in proportion to digital
phonorecord deliveries in general, the extent to which limited digital
phonorecord deliveries may promote or may substitute for the sales of
phonorecords or otherwise may enhance or may interfere with the copyright
owner's other streams of revenue from its nondramatic musical works, and 
proportion of the revenue received by the compulsory licensee from every
such act of distribution of the phonorecord under this clause equal to the
proportion of the revenue received by the compulsory licensee from
distribution of a general digital phonorecord delivery that is payable by a
compulsory licensee under clause (2) and under chapter 8.";

The copyright arbitration (that word spells "more lawyers") royalty panel -
is this a newly defined arm of the Government? - shall decide whether you
are right or not in not wanting mp3.com to freely broadcast your work, and
may decide whether or not any freebies substituted for sales figures, or 
that matter legal expenses involved in getting a recording to the digital
market, apply to what the IRS thinks you make, whether this adds or
subtracts from your bottom line or not.

>(4) by inserting in paragraph (5) after "next preceding." the following:
"Payments for digital phonorecord deliveries shall be made to the copyright
owner or, if the notice of intention has been served upon the Copyright
Office, to either the copyright owner or the Copyright Office."

Potentially vague - back to the bit about whether the "notice of intention"
has been served to the Copyright Office, payments will be made either to 
copyright owner or the Copyright Office.  This doesn't say whether a
mechanism will be set up inside the Copyright Office to handle your money
while you're waiting - how long? - to get paid for something you created 
legally own.

>"(2) A 'limited digital phonorecord delivery' is a digital phonorecord
delivery that uses a technology that restricts the time or manner in which
the transmission recipient may render such sound recording audible.".

If it's finite, it's "limited".  But this only applies to the recording and
its delivery, and not fees.

>Not later than 120 days after the date of enactment of this Act, the
Register of Copyrights shall --

>(A) establish procedures by which the notice of intention may be served
electronically upon the Copyright Office, and by which reasonable notice of
the filing of a notice of intention may be given to the owner of copyright
in the nondramatic musical work;

Four months after this becomes law, the Copyright Office must provide an
electronic means of the "notice of intention" being accepted.  This could
take the form of a simple email message saying mp3.com is broadcasting your
work, and remember, if you didn't register it with the Office, you'll never
know this notice happened.  Accordingly, who gets paid then?

>(B) prescribe by regulation the requirements for the form, content, and
manner of electronic service of the notice, including notices that identify
one or more works of a particular copyright owner and notices that identify
one or more works of numerous copyright owners; and

This cannot be done in 120 days, folks.  I've worked on mainframe apps that
handle royalties and publishing / copyrights, and the accounting for all 
little bits take quite a bit of time.  Perhaps the whole of India will get
hired to write this app.  Or perhaps a company with friends in Congress has
already sold their way into the process, despite not having finished the
application as yet.  In essence this provides for years and years of work
for SOMEBODY, working on this Copyright Tracking Application.  And then
there's the online part!  Save us!

>(C) prescribe regulations for the appointment of a designated agent to
receive royalty fees and statements of account, to distribute royalty fees
to the copyright owner, and to administer royalty fees that have been
submitted for unknown copyright owners.

This will make it mandatory for copyright owners to designate an agent or
other entity to receive the money, and the accounting, and in turn pay the
copyright owner what otherwise the copyright owner would just get PAID.
More legalistic superstructure to provide work for lawyers, and keep the
little guys out of the music business.

>The Register of Copyrights may prescribe regulations whereby royalty fees
are paid to an escrow account at the last established rate in which the
terms and rates for the then-current period have not been determined,
including for the period prior to the date of enactment of this Act.

Another legalistic superstructure.  Escrow accounts aren't necessary if the
artist or copyright holder is getting PAID.


>"(d) Notwithstanding the provisions of section 106, it is not an
infringement to make or to authorize the making of a copy or phonorecord of
a sound recording or a work included in a sound recording, in a digital
format, provided that such copy or phonorecord is created by and is
incidental to the operation of a device in the ordinary course of the use 
a work otherwise lawful under this title.

So, it's legal when MCA/Universal, Sony or Warner Brothers provide a
file-sharing system for music, but when the Government decides it's not,
it's NOT.  More anti-Napsterism?

>"(e) Notwithstanding the provisions of section 106, it is not an
infringement for the owner of a phonorecord lawfully acquired by digital
phonorecord delivery, or a copy lawfully acquired by digital transmission 
a literary work embodied in that phonorecord, to make or authorize the
making of another phonorecord or copy of such works, if such new 
or copy is for archival purposes only and that all archival phonorecord or
copies are destroyed in the event that continued possession of the
phonorecord or copy should cease to be rightful.".

"lawfully acquired" is used a lot here it seems, and hopefully this means
"bought with money", but I suspect it also means "acquired by 'notice of
intention'".  Inclusions for backups and mirrors are made again, 
that if your work from a broadcast done months ago is on a backup tape
somewhere, they've got a right to keep it, but that if the work was not
"lawfully acquired", the archives must be destroyed.  Potentially
conflicting on its own.

>The Register of Copyrights, in consultation with the Assistant Secretary 
the Office of Technology Policy of the Department of Commerce, shall
evaluate the effects, under the statutory sound recording performance
license set forth in section 114(d)(2) of title 17, United States Code, 
preexisting and emerging non-interactive digital audio transmission 
of the criteria set forth in sections 114(d)(2)(B) and 114(d)(2)(C)(i) and
(ii) of such title, with respect to --

The Register of Copyrights etc. shall evaluate the possible effects of this
legislation upon existing Copyright law and the Commerce Code, regarding
digital audio transmission services, regarding:

>(1) the economic costs of compliance with the criteria;

How much will it cost everyone to comply with this new legislation?

>(2) the effect of compliance with the criteria upon the nature of the
programming and the marketability of such services;

How much will it affect the companies that operate replication, broadcast
and streaming services, and how will it affect the cost of

>(3) whether any non-interactive digital audio transmission service would 
unable to comply with the criteria and, therefore, to qualify for the
statutory license;

Will anyone making technology or providing transmission service be excluded
by not being able to comply, and therefore not qualify for any license to 

>(4) whether any changes to the criteria, including the elimination 
would enable additional non-interactive digital audio transmission services
to qualify for the statutory license; and

Is there anything else technologically that would be affected by the need 
qualify under the legislation?

>(5) the likely impact upon copyright owners of sound recordings of any 
changes to the criteria.

What impact upon copyright owners will there be under this legislation?
(See above)


>"The Register of Copy rights shall, not later than 12 months after the 
of enactment of this Act, submit to the Congress a report on the evaluation
conducted under subsection (a), including any legislative recommendations
the Register may have.

The Register of Copyrights will report on all this within a year of this 
going into effect, as noted in items 1-5 just above, and make
recommendations.  (Didn't Perot call this "closing the barn door after the
cow's gone outside"?)

Sorry about the length, but it's the frigging lawyers at RIAA who are doing
this in order to make us go back to the Good Old Days of the Studio System.
Surprising given their immense failure at their monolithic effort to stamp
out home recording in the 80s.

Again, the introducers (not necessarily the authors, get it folks?) are
Chris Cannon, a Republican from the 3rd district of Utah, web page at
http://www.house.gov/cannon/ - and Rick Boucher, a Democrat from the 9th
district of Virginia. http://www.house.gov/boucher/

If you want to give all this away you'll just say nothing and watch your
rights to record at home again become challenged in a matter of years, if
not months.  RIAA's WORKING on this.  Democracy is a participative process,
alas, and reflects none but those who do the participating.  I really hate
politics, and I hate it more when I feel like I have to be involved in it.

So it goes, huh?  Get the word out and forward this to as many as you think
can do something with it.

Stephen P. Goodman
EarthLight Productions