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Above-Entitled Matter Convened, Pursuant to Adjournment, in the Offices of the Copyright Royalty Tribunal, in Room 92Lg 1825

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Above-Entitled Matter Convened, Pursuant to Adjournment, in the Offices of the Copyright Royalty Tribunal, in Room 92Lg 1825 rI . r, I 821 BEFORE THE COPYRIGHT ROYALTY TRIBUNAL WASHINGTON, D.C. In the Matter of 1990 CABLE COPYRIGHT ROYALTY DOCKET NO. CRT 92-1-90CD DISTRIBUTION PROCEEDING (This volume contains pages 821 through 949) Washington, D.C. Friday, September 17, 1993 The above-entitled matter convened, pursuant to adjournment, in the Offices of the Copyright Royalty Tribunal, in Room 92lg 1825 Connecticut Avenue, N.M., Mashingtoni D AC g at 10:00 a.m. BEFORE: CINDY DAUB Chairperson BRUCE D. GOODMAN Commissioner EDWARD J. DAMICH Commissioner LINDA R. BOCCHI General Counsel NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 2344433 WASHINGTON, D.C. 20005 (202) 234-4433 822 APPEARANCES: PROGRAM SUPPLIERS: On behalf of MPAA: DENNIS LANE, ESQUIRE JANE SAUNDERS'SQUIRE BRIAN HOLLAND, ESQUIRE Morrison R Hecker 1150 18th street, N.TI(t. Suite 800 Washington, D.C. 20036-3816 (202) 785-9100 Music Claimants: On behalf of ASCAP: I. FRED KOENIGSBERG, ESQUIRE White 6 Case 1155 Avenue of the Americas New York, New York 10036-2787 (212) 819-8200 BENNETT M. LINCOFF, ESQUIRE Senior Attorney, ASCAP One Lincoln Plaza New York, New York 10023 (212) 621-6270 On behalf of BMI: CHARLES T. DUNCAN, ESQUIRE MICHAEL FABER, ESQUIRE MARC A. LURIE, ESQUIRE Reid R Priest 701 Pennsylvania Avenue, N.W., Market Square Washington, D.C. 20004 (202) 508-4081 On behalf of SESAC: LAURIE HUGHES, ESQUIRE SESAC, Inc. 55 Music Square East Nashville, Tennessee 37203 (615) 320-0055 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 823 APPEARANCES: (Continued) On behalf of Multimedia: ARNOLD LUTZKER, ESQUIRE CARY ANN EURE, ESQUIRE Dow, Lohnes and Albertson 1255 23rd Streeet, N.W. Washington, D.C. 20037 (202) 857-2941 NATIONAL ASSOCIATION OF BROADCASTERS: JOHN I ~ STEWART I JR i ESQUIRE KATHERINE WHITE, ESQUIRE Crowell & Moring 1001 Pennsylvania Avenue, N.W. Washington, D.C. 20004-2505 (202) 624-2500 JOINT SPORTS CLAIMANTS: ROBERT A. GARRETT, ESQUIRE JAMES S. PORTNOY, ESQUIRE KITTY BEHAN, ESQUIRE Arnold & Porter 1200 New Hampshire Avenue, N.W. Washington, D.C. 20036 (202) 872-6700 PUBLIC BROADCASTING SERVICE: TIMOTHY C. HESTER, ESQUIRE MICHELE J. WOODS, ESQUIRE Covington & Burling 1201 Pennsylvania Avenues N W g PION Box 7566 Washington, D.C. 20044 (202) 662-6000 DEVOTIONAL CLAIMANTS: JOHN H ~ MIDLEN i JR ~ i ESQUIRE Midlen & Guillot, Chartered 3238 Prospect Street, N.W. Washington, D.C. 20007-3214 (202) 333-1500 MEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 APPEARANCES: (Continued) BARRY H. GOTTFRIED, ESQUIRE Fisher, Wayland, Cooper & Leader 1255 23rd Street, N.W. Suite 800 Washington, D.C. 20037 (202) 659-3494 RICHARD M. CAMPANELLI, ESQUIRE Gammon & Grange 8280 Greensboro Drive, 7th Floor McLean, Virginia 22102 (703) 761-5000 MEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 2344433 WASHINGTON, D.C. 20005 (202) 234~33 825 CONTENTS EXAMINATION NITNESSES DIR CROSS REDIR RECROSS Proaram Suooliers Howard Green By Mr. Lane 826 By Mr. Garrett 853 By Mr. Stewart 903 By Mr. Hester 922 By Mr. Midlen 940 EXHIBITS FOR NUMBER IDENTIFICATION RECEIVED Joint Snorts 12-X (FCC RRO) 858 13-X (MPAA comments in Syndex 862 Proceeding) 14-X (MPM Reply Com in Syndex 862 Proceeding) 15-X (Printout CDC FM 3 90-2) 869 16-X (SOA 90-1 Intn'l Cbl) 872 17-X (Com of Coal to Presv Fin 888 Int & Syn Rules) NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 826 PROCEED I NGS (10:03 a.m.) CHAIRPERSON DAUB: On the record. This morning we will continue the 1990 Cable Royalty Distribution Proceeding, with the witness Mr. Howard Green for Program Suppliers. Whereupon, HOWARD GREEN was called as a witness and, having first been duly 10 sworn, was examined and testified as follows: DIRECT EXAMINATION 12 BY MR. LANE: 13 Q Please state your name for the record. 14 A Howard Green. 15 Q Did you prepare or have prepared under your 16 direction and supervision the Testimony of Howard 17 Green, Senior Vice President of Sales Operation, 18 Twentieth Television, that has been previously 19 exchanged in this case? 20 A Yes, I did. 21 Q Do you have any corrections to that 22 testimony? 23 A Yes. If you would turn to page 4 of the testimony, there is a mathematical error. In the 25 first inset paragraph under Costs of Network Program NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 234-4433 827 Production, the fourth line down, "50%" shoudl be ll ] 8gll Q Did you also prepare or have prepared under your direction and supervision the two exhibits that are attached to your testimony? A Yes, I did. Q Do you have any corrections to those exhibits? A Yes. On the second exhibiit, which is the 10 Comparison of Distant and Spill-in Signals on the Local Market, first page at the bottom, in the Atlanta and Macon comparison. If you look at the second to 13 last entry, People's Court which plays in Atlanta at 5:30, if you look at the next box to it, the spill-in signal is actually measured between 4:00 and 6:00, so that, should be "4-6P", the same as the Oprah number 17 above it. 18 Q By whom are you employed, Mr. Green? 19 A By Twentieth Century Fox Film Corporation. 20 Q What is your position? 21 A I'm Senior Vice President, Sales Operation. 22 Q What are your duties and responsibilities 23 in that position? 24 A I supervise three departments, two of which 25 are Contract. Administration and Sales Administration, MEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234~33 WASHINGTON, D.C. 20005 (202) 234-4433 828 which support domestic television and international television in the licensing of programs to stations worldwide. Q How long have you been in that position? A A little over 18 months. Q And prior to that, what position did you hold? A I was Vice President of Sales Contract and Systems Administration for Paramount Pictures 10 Corporation. Q Shat were your duties and responsibilities' 12 A They were substantially the same as they 13 are at Fox. Q And how long were you with Paramount? 15 A Ten years. 16 Q What did you do before you were with 17 Paramount? 18 A Before that, for 20 years I was a 19 professional actor, director, and artistic director in 20 the New York theater. 21 MR. LANE: At this time, Madam Chairmani I 22 would make Mr. Green available for voir dire. 23 CHAIRPERSON DAUB: Thank you, Mr. Lane. 24 Any voir dire? 25 MR. GARRETT: I have no questions. MEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 2344433 WASHINGTON, D.C. 20005 (202) 234-4433 829 CHAIRPERSON DAUB: Mr. Stewart? MR. STEWART: No questions. MR. HESTER: No questions. MR. MIDLEN: No questions. CHAIRPERSON DAUB: Thank you. Mr. Lane, please continue. MR. LANE: Thank you. BY MR. LANE: Q What is the purpose of your testimony, Mr. 10 Green? A What I'd like to do is to provide an 12 overview of the trends in syndicated television from 13 1980 to the present day, and I'd like to describe, if 14 I can, the impact of the importation of distant 15 signals on the program suppliers who supply the 16 programs on a market-by-market basis. 17 Q Would you define "syndication"? 18 A Syndication is generally taken to mean the 19 licensing of programs nationwide, on a market-by- 20 market basis, sold to each individual local station as 21 opposed to a network. 22 Q What form does syndication take'? 23 A Currently, the syndication is three-fold. 24 Originally, syndication was off-network programming, 25 in the early part of the period that I'm talking NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1323 RHODE ISLAND AVENUE, N.W. (202) 234-4433 WASHINGTON, D.C. 20005 (202) 2344433 830 about, and product was licensed on a straight-cash basis -- the station paid a license fee -- and it was immaterial to the program supplier if the program was played at all. How it performed in the market was only important in the sense that they wanted to continue to be able to license that program, but the license fee meant that the station bore the entire risk of failure or success in that market. Toward 1982, there began a phenomenon 10 called "barter". What barter is is that part of the compensation to the program supplier is in the form of 12 time in the program in an individual market. That 13 time is sold by the program supplier to national advertisers, which requires a national clearance of 15 the program simultaneously across a substantial part 16 of the United States, it requires that the program be 17 played during substantially the same time frame 18 everywhere in the United States because that's the 19 only way the advertiser will get the benefit of his 20 bargain. 21 There was, to some degree, "straight 22 barter", which meant there was no cash portion, no 23 license fee and, later, or at the same time actually, 24 there was also what is called "cash/barter" where the 25 license fee that is paid is a lower license fee than MEAL R.
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