30 years ago, america's cable companies created c-span as a public service. a private business initiatives. no government mandate, no government money. >> this week on "the communicator's p " the internet and current copyright policy and how it is affecting the news industry. our guest is the chairman of -- >> when you hear the term file sharing, what you think of? >> i think of all my artists that will not get played -- paid. we have a large staff of songwriters that come into our office every day and write songs for a living. file sharing has wreaked havoc

on our business. piracy is a huge issue for our industry. i think the music industry has been really at the front line in terms of the impact of digital on an intellectual property business. i think the film and television industry has looked at what has happened to our industry, and they are trying to prevent some of the things that have happened. it is a huge challenge for us. one in which i think we're seeing some positive government reaction to. recently in france, they enacted something that we could call a three strikes law. if you are at home and download illegally, you get to warnings. the third time you're caught, you're disconnected from the internet. i think that sends a powerful message.

i think there was a case recently, one in europe against something called "pirate day. pete -- pirate bay. it was a strong victory against this website. this remains one of the biggest challenges to our industry, and to all creative industries. the fact that millions of people are able to download music and other films and television shows illegally, and traders do not get paid, artists did not get paid. it has created an incredibly difficult environment to struggle through this whole time of transportation. >> what is to prevent somebody

from downloading in belgium right next door and send it over to somebody in france? with the internet so international, how you stop the file sharing? >> i believe what the french legislation is meant to do is to put pressure on local isp providers. i think that is a message that is important. we really want to see isp providers take some responsibility here. you're providing a service your customers, but that should not mean they your providing an access point for them to steal. that is really what the isp providers in each territory? i think that is what we would like to see happen. there is a kind of

responsibility globally. it is something we should certainly see in the more advanced democratic countries. when we look at other territories around the world like china for instance, russia, huge challenges in terms of the -- it used to be intellectual property or the piracy problem was physical. you could walk down the street, and you still can in certain territories. you can find movies that have not even been released theatrically at. certainly cds being sold on the street. the internet -- the problem has compound exponentially. one of the goals of my industry is to have isp stake market --

take more -- i s p's take more responsibility. >> has the u.s. congressmen responsive to your concerns? >> we have not really seen legislation. we still have a ways to go here in the u.s.. in terms of seeing legislation that would make isp's more responsible -- it is illegal to buy pirated cds. the question is enforcement. we have a loss. it is the difficulties and forcing them. rebecca hoffman is also here with us.

>> i like to talk a little bit more about file sharing. some people believe that it is not -- is utile to try to stop file sharing. it is going to keep going on, and it should be embraced. we should use it. is it possible that file sharing could be used to the advantage of the music industry? >> there are all kinds of business models out there. there is been significant amount of experimentation. one of the things that we have certainly seen it is that there's been a significant growth in the ipod and i tens -- itunes. years ago, there is more of an argument that could have been made. consumers do not have legitimate options or ways of buying music

online. that is why they are stealing. you can't say that today. there are a plethora of services out there that are legitimate. itunes is probably the most successful online legitimate site forg uyin bmusic. it is incredibly popular. amazon has launched, and there are many other legitimate ways to purchase online music. there has been a growth and some of the business models. there is -- there are legitimate streaming services. there is a way to customize an online streaming radio station to music and i like. there are so many different ways to get music in a legitimate way that i think we can't make that argument that it is ok to steal because they can't get any other way.

i think my industry -- the industry is going to continue to of all. there is a huge popularity of online music videos. one of the things my company is working on launching is going to be an online channel for watching premium video content and other content. it is evolving, is exciting, and at the same time, we're in this tremendous battle. retail is shrinking. you used to be able to go to your record store, and retail has taken a tremendous hit. i think that is one of the symptoms of the shift to digital, and the tough economic conditions. eventually, it should be a good thing, right?

instead of having to stop all of your favorite old records and have a deep catalog, is easier to do that on line and to find your favorite releases. catalog sales online are very popular. again, there is a wonderful opportunity to find a great music online in a legitimate way. i think that education is important, too. kids are growing up, generation that feels like getting music illegally is ok. there is a challenge economically, because some of the models -- our business was very much geared towards albums. it is a different business model that has to find its way to

evolve. i just did not buy the argument that people say, file sharing should be ok. we should legitimize it. >> you're talking about people losing money like cd retailers. he also said that file sharing is wreaking havoc on the publishing business. can you explain that a little more? how was the money made in making music? how is it now being lost because of file sharing? >> when you buy a cd, whether it is an album or you want to download a symbol, apple makes money, the artist makes money, the song writer makes money, and the publisher makes money. there are two basic copyright. the copyright in a recording and

the copyright and the song. music publishers control the copyright in the song. that is my area of the business. they're different rates globally. we have a statutory rate of 9.1 cents. every time a song as bought online, at 9.1 cents has to be paid to the publisher. they're different ways that that gets split depending on the deal. that is the basic economics of songwriting. songs also can generate money once they become successful. you downloaded, there is a 9.1 cents for the purchase, and the song can become a hit and suddenly you're on the radio and generating performance in come

from radio play. if the jets synchronized to a commercial, or forgets synchronize and a film or television show, there will be different ways that performance in come can be earned from that. we have some challenges. currently, one of our big issues is that when you download a piece of music in the u.s., like other territories around the world, there isn't performance income for download. you get a mechanical if you download a song, but if you download a tv show or a film, the composer does not get a mechanical, and the composer does not get any performance. the blood made their living composing for film and tv are really very concerned about this. this is one of the legislative

priorities as both the performing rights organizations collect performance and come in the u.s.. they're very concerned about it. they're going to be looking for potentially legislative solutions, and there is also on appeal because this is the result of a court ruling. >> can you very briefly describe the business model of the universal music publishing group for us? >> we're a global publishing company. we represent some writers, artists, and in some cases, it might be like leonard bernstein, artists that sells records around the world. there are some songs we have in our back catalog. one of the composers of our most successful songs is still alive.

every year, the son gets covered. there is a news and allowed coming out by the pussycat dolls, and very successful group where it is a cover this go version of i will survive. that is one example -- a song is a beautiful thing. songs can be covered so many times. with so many songs in our catalog. it is unbelievable, the life that a song has. we all appreciate that because when we think back on our special moments, -- you know, our business is really to protect those songs and collect the income related to those songs.

every time our son is used or recorded -- our song is used or recorded in a television show, our job is to license it, collects the and come around the world. in the u.s., it is difficult for a publisher to go to every radio station, every tv station, every bar and grill and say, can you please pay my song writers? there are other groups that are performance rights collection organizations there also some -- collection organizations. there also some organizations that help. the help publishers and songwriters collect their and come through a blanket licenses, etc. that is our business model.

our model was also -- we have been more resilient than any other business model and the music business because we do have all these various revenue streams. the songwriters and our business is going through a very challenging time. the mechanical and come related to the sale of those disks -- record sales are being tremendously impacted by the change in new technology and the access to free or legal. we're struggling to that as a whole industry faces those challenges. >> the television broadcasters have taken a tentative step towards free tv on computers through hulu. the uc something like that in the music feature? -- do you see something like that in music's future?

>> i mentioned we were launching an on-line video site call vivo. i did not know if the plan is to launch with a fee or if it is at supported. i think they're actually talking to advertising partners. it is usually -- music video content is largely popular online. video content is very popular. universal was one of the first companies that stood up and said, we would like to be paid for that video content. we would like to get our artists and some writers paid. you know, hulu has been very

successful. music videos online very popular. it will be interesting to see as we gear up to launch -- i believe youtube is our partner. we hired someone from universal who will be heading that business. it is a division of -- i think it will be potentially exciting development. >> besides apple and itunes, is digital music economically successful. --? how you prevent the leakage? >> i think they have proven that it is hugely successful. it has certainly been successful in selling bipods -- ipod's.

there is experimentation going on as well. should premium to releases be priced a little higher? an older releases at a slightly lower. ? it has been an interesting evolution. there are so many different models. we get approached by companies that have a new concept their lodging. there is the purely at supported model that is free, and we have licensed those sites. their new devices, i believe san disc came to us and said it wanted to 73 for people that are not as sophisticated downloading legitimately, so we will sell them and p 3 player,

and we want to load it with 1000 songs. we have to think outside the box with these, because if you get 9.1 cents for every song, those 1000 songs would not necessarily work. that is one of our challenges. it is part of our business philosophy, where technology agnostic. i do not ask my people, what model is going to emerge and to become the dominant or successful business model? we're not geniuses. we do not know. we ultimately did not know what the consumers are really going to respond to. one of our goals is to license all of the legitimate business people out there, the new businesses that want to launch. that is okay. we will work with you to try and figure out and license your

business so you can launch and we can get our song writers paid. that is our goal is for its music publishing. -- as far as music publishing. there are new businesses that people have never heard of yet that we have licensed. there are some that were successful in europe. it is an ad supported model. it is of -- is a great success. we launched in latin america. you going to buy a new cell phone that gives you access to a huge catalog of music, and kind of built into the price of the cellphone is this access. there are some of different models. it is exciting. -- there are some many different models. it is exciting.

we're not going to see a slowdown. i love the entrepreneur is -- i love entrepreneurs. if people come up with new business ideas, that is great. we want to work with you and license our repertoire to you. >> you talk about royalties, how they're collected, and why they're collected. at bna, we are closely rot -- closely watching the performance rights act. the debate over the legislation is contentious, and i was wondering if you could tell us what that debate is about, and how you would like to see it resolved. >> the performance right act is related to the sound recording,

the copyright of the sound recording. in the u.s., there is currently no performance right attached to it. in a lot of other territories around the world, there is a performing right in the sound recording. radius stations in europe, for instance, do have to pay a royalty for the recording and that is shared by the artist and the record company. it is something that the record companies would like to see instituted, and many artists as well, in the u.s.. that legislation has language in it that would protect song language -- songwriters. as ready as stations negotiate their blanket licenses with ascap and bmi, the songwriter's

income would not be diminished. the truth is, for artists who do perform -- in some cases, the artists are not a songwriter. the songwriter does get paid, and the artist does enjoy a performing right in that sound recording. the nab, the broadcasters, in terms of vocal -- in terms of being vocally opposed to it have framed the argument that we do not feel like we should have to pay. we provide promotional support. there is truth to that. the framed it in some cases as this is another tax on radio. we have a philosophy of, we want

to support the industry, we kind of have a 1 music philosophy. that means that content should be compensated. publishers and songwriters have been supportive of the performing right and a sound recording. there's a lot of support on the hill for the concept that artists should be compensated. special when you look at the fact that this is happening around the world. >> david windsor, when it comes to copyright and piracy, how you deal with that internationally? >> i think we touched on some of it. in most territories, there are strong copyright laws and anti piracy laws. i think the challenge everywhere

is enforcement. at the end of the day, as some writers are not going to get paid, there will be some motivation, that there will not be an industry structure that will support the music that we love. also the trade value, the export value of american music is huge. there is tremendous value to many foreign markets. i think we have something, for instance in the u.s., composers did not get paid when there is no performing right in a download, just to differentiate it from the performing right and the sound recording. when you downloaded film or tv show, there is no performance in town.

foreign societies to represent composer's own whose songs bad -- it look at and say, this is not right. how can it be and the u.s. we're not getting that? there are different ways of protecting copyright. that is the challenge, making sure that copyright is being compensated, the composers, songwriters are fairly compensated so that there can be an industry. >> is there an international group that does that? >> there are several. there is a conference going on here in washington d.c.. it is an organization that represents the collecting societies around the world who help publishers and songwriters collect their income. there is the international

organization that helps protect the recording industry. frankly, there are dozens of intellectual properties in the societies around the world -- intellectual properties and societies around the world whose job is to protect intellectual property. they also invest a lot of money, whether it is in lobbying, in some cases various forms of enforcement. in some cases, there have been lawsuits that have to be brought. that is part of the function of society. we have to fund litigation to protect intellectual property. >> rebecca hoffman, final question. >> if i want to make a video and put it on youtube, and i want to use copyrighted music, i think it is a fair use, i am i using a

very good copy of it, can this pose a problem? what should i do? >> you ended with a doozy of a question. there was one phrase used their that i think is a real touchy one. the fair use phrase. putting that aside, if you're going to use a piece of music in a video, there is a copyright involved. and there are rights that need to be clear. how do we deal with that as an industry? my company has a deal with youtube. we have to deal with myspace. we have worked out an arrangement with youtube that allows you to put videos online , and there are different types of videos on youtube. there are some