Notice and Recordkeeping for Use of Sound Recordings Under Statutory License, 21704-21711 [05-8435]

Agencies

• Library of Congress
• Copyright Office
• Copyright Office, Library of Congress

[Federal Register Volume 70, Number 80 (Wednesday, April 27, 2005)]
[Proposed Rules]
[Pages 21704-21711]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-8435]


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LIBRARY OF CONGRESS

Copyright Office

37 CFR Part 270

[Docket No. RM 2002-1H]


Notice and Recordkeeping for Use of Sound Recordings Under 
Statutory License

AGENCY: Copyright Office, Library of Congress.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Copyright Office of the Library of Congress is proposing 
regulations for the delivery and format of records of use of sound 
recordings under two statutory licenses of the Copyright Act.

DATES: Comments are due no later than May 27, 2005.

ADDRESSES: If hand delivered by a private party, an original and ten 
copies of any comment should be brought to Room LM-401 of the James 
Madison Memorial Building between 8:30 a.m. and 5 p.m. and the envelope 
should be addressed as follows: Copyright Office General Counsel, U.S. 
Copyright Office, James Madison Memorial Building, Room LM-401, 101 
Independence Avenue, SE., Washington, DC 20559-6000. If hand delivered 
by a commercial courier, an original and ten copies of any comment must 
be delivered to the Congressional Courier Acceptance Site located at 
Second and D Streets, NE., Washington, DC, between 8:30 a.m. and 4 p.m. 
The envelope should be addressed as follows: Copyright Office General 
Counsel, Room LM-403, James Madison Memorial Building, 101 Independence 
Avenue, SE., Washington, DC. If sent by mail (including overnight 
delivery using U.S. Postal Service Express Mail), an original and ten 
copies of any comment should be addressed to: Copyright Arbitration 
Royalty Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC 
20024-0977. Comments may not be delivered by means of overnight

[[Page 21705]]

delivery services such as Federal Express, United Parcel Service, etc., 
due to delays in processing such deliveries.

FOR FURTHER INFORMATION CONTACT: David O. Carson, General Counsel, or 
William J. Roberts, Jr., P.O. Box 70977, Southwest Station, Washington, 
DC 20024-0977. Telephone: (202) 707-8380. Telefax: (202) 252-3423.

SUPPLEMENTARY INFORMATION: This Notice of Proposed Rulemaking 
(``NPRM'') marks another step in the Copyright Office's continuing 
efforts to adopt regulations that require eligible digital audio 
services availing themselves of the statutory licenses set forth in 17 
U.S.C. 112 and 114 to report their usage of sound recordings. On March 
11, 2004, the Office published interim regulations in the Federal 
Register setting forth the types of information that must be kept by a 
digital audio service for each copyrighted sound recording it transmits 
to its users. 69 FR 11515 (March 11, 2004). This information 
constitutes a record of use of a sound recording. In this document, we 
propose regulations to establish the format in which each record of use 
must be kept, along with directions for delivery of the data to the 
Receiving Agent (SoundExchange, Inc.).\1\
    Before discussing the substance of this NPRM, the Copyright Office 
notes that the Copyright Royalty and Distribution Reform Act of 2004, 
Public Law 108-419, goes into effect on May 31, 2005. Under this 
legislation, responsibility for notice and recordkeeping regulations 
under the section 112 and 114 statutory licenses is transferred from 
the Librarian of Congress and the Copyright Office to the new Copyright 
Royalty Judges (``CRJs''). See 17 U.S.C. 114(f)(4)(A) & 112(e)(4) 
(effective May 31, 2005). It is the intention of the Office to receive 
comments on the rules proposed below by May 27. It is anticipated that 
the CRJs will assume responsibility for this ongoing rulemaking 
proceeding as of May 31 and will consider this notice, the comments 
received in response to the notice, the prior record of this proceeding 
and any additional comments that they may solicit as they conclude this 
rulemaking.
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    \1\ For more information on the history of this rulemaking 
proceeding, including comments received from the public and the 
transcript of a public roundtable, go to https://www.copyright.gov/
carp/114/.
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I. Overview

    Digital audio services transmit performances of copyrighted sound 
recordings of music for the listening enjoyment of the users of those 
services. In order to transmit these performances, however, a digital 
audio service must license the copyrights to each musical work, as well 
as the sound recording of the musical work.\2\ With respect to the 
copyright in the sound recording, the digital audio service may seek to 
obtain a licensing agreement directly with the copyright owner or, if 
it is an eligible service,\3\ may choose to license use of the sound 
recording through statutory licenses set forth in the Copyright Act, 
title 17 of the United States Code. There are two such licenses that 
enable an eligible digital audio service to perform a copyrighted sound 
recording for its listeners: Section 114 and section 112 of the 
Copyright Act. Section 114 permits an eligible digital audio service to 
perform copyrighted sound recordings to its listeners, provided that 
the terms and conditions set forth in section 114 are met--including 
the payment of a royalty fee. Section 112 permits an eligible digital 
audio service to make the digital copies of a sound recording that are 
necessary to transmit a sound recording to listeners, provided again 
that the terms and conditions set forth in section 112, including the 
payment of a royalty fee, are met.
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    \2\ Recorded music typically involves two separate copyrights. 
There is a copyright for the song itself--the lyrics and the music--
and there is a separate copyright for the sound recording of the 
music. The copyright to the musical work typically belongs to the 
songwriter and/or his or her music publisher, and the copyright to 
the sound recording is owned by the record company that recorded it.
    \3\ These services are defined as preexisting subscription 
services, preexisting satellite digital audio radio services, 
business establishment services, nonsubscription services and new 
subscription services. These services are further discussed, infra.
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    The royalty fees collected under the two statutory licenses are 
paid to a central source known as a Receiving Agent. See 37 CFR 261.2. 
Before the Receiving Agent,\4\ or other agents designated to receive 
royalties from the Receiving Agent, can make a royalty payment to an 
individual copyright owner, they must know how many times the eligible 
digital audio service made use of the sound recording and how many 
listeners received it. To obtain this information, both section 112 and 
section 114 direct the Librarian of Congress to prescribe regulations 
that identify the use of copyrighted sound recordings, as well as 
provide copyright owners with notice that a particular eligible digital 
audio service is making use of the section 112 and/or 114 license. See 
17 U.S.C. 112(e)(4) and 114(f)(4)(A).
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    \4\ SoundExchange, Inc., originally created by the Recording 
Industry Association of America, Inc. on behalf of its member 
companies, is currently the Receiving Agent for receiving both 
section 112 and 114 royalties.
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    Interim regulations setting forth the types of information that 
constitute a record of use of a particular sound recording have already 
been adopted. 69 FR 11515 (March 11, 2004). Questions remain, however, 
regarding the organization and format of the record of use data and the 
acceptable means of delivering that data to the Receiving Agent, 
SoundExchange. Format and delivery are highly complex technical matters 
and have been a great source of contention between the parties that 
have submitted comments in this docket. It was hoped that 
representatives of copyright owners, performers, and licensees could 
resolve the issues through private negotiation, and the Copyright 
Office encourages continued discussions. Nevertheless, we must proceed 
with regulations. As with the interim regulations adopted last year, 
the regulations proposed in this document represent the baseline 
requirements. In other words, digital audio services are free to 
negotiate other formats and technical standards for data maintenance 
and delivery and may use those in lieu of regulations adopted by the 
Copyright Office, provided that SoundExchange finds them acceptable. We 
have no intention of codifying these variances in the future unless and 
until they come into such standardized use as to supersede the existing 
regulations.

II. Data Contained in a Record of Use

    As noted above, the details of the types of information that must 
be reported for a record of use of a sound recording are set forth in 
the Interim Regulations. Id. For purposes of discussing the format a 
record of use must take, we summarize the required data elements.
    Each record of use must contain at least six separate elements of 
data identifying the sound recording. The first four mandatory elements 
are: The name of the digital audio service reporting the record of use; 
the transmission category code that identifies under what royalty fee 
the sound recording was used; the name of the featured artist appearing 
on the sound recording; and the title of the sound recording. For the 
fifth and sixth reporting elements, services have an option on the 
information to report. For the fifth element--the identification of the 
sound recording--services must report the International Standard 
Recording Code (``ISRC'') solely, or in lieu of the ISRC, they must 
report the name of the album on which the used sound recording appears 
plus the name of the company that markets the album.

[[Page 21706]]

For the sixth element--total number of performances of the sound 
recording during the reporting period--services must report the actual 
total number of performances of the sound recording, or in lieu of 
that, the ``Aggregate Tuning Hours'' (total hours of programming 
transmitted by the service multiplied by the total number of listeners 
who have accessed the service during the reporting period) plus the 
name of the channel or program on which the sound recording was 
performed.
    These are pieces of information that are required to create a 
report of use of a sound recording for the section 112 and/or 114 
statutory license. We now turn to how this information is to be 
organized and formatted.

III. Organizing and Formatting the Data

    The matter of the organization and format in which recordkeeping 
data is to be maintained for delivery to agents specified in the 
Copyright Office regulations to receive section 112 and 114 royalties 
is the subject of considerable disagreement between copyright owners 
and users. The first issue of dispute is whether services may elect to 
maintain records in either electronic or hard copy form, or whether 
reporting must be made in electronic form only. As noted above, the 
Copyright Office met with representatives of both owners and users 
after the May 10, 2002, roundtable to discuss the matter of format and 
solicited written proposals and conducted a public meeting. See 67 FR 
59574 (September 23, 2002). During the course of those discussions, the 
Office expressed the view that transfer of hard copy records of 
performances would be cumbersome, expensive, and of little or no value 
to the royalty distribution process. We have not been persuaded 
otherwise by the written comments submitted in this docket or the 
subsequent discussions on format of data. Consequently, we are 
proposing that records of use must be in electronic format and that 
delivery of physical hard copies of records of use of sound recordings 
is not acceptable. We welcome further comment.
    Having proposed that records of performances must be kept in 
electronic format, we turn to the details of organizing and formatting 
the data. Recognizing that there is a wide variance in the technical 
sophistication of services for creating records of use, the Copyright 
Office is proposing a two-track approach. For those services with 
minimal technical sophistication or resources, the Office is proposing 
that they supply record of use data in a standard electronic 
spreadsheet format. For those services that eschew use of a 
spreadsheet, the Office is proposing the technical requirements for 
formatting.

A. Use of a Spreadsheet

    As noted above, there are likely a number of services--
noncommercial broadcasters, for example--that lack the technical 
knowledge or ability to assemble their record of use data and format it 
according to the requirements set forth in subpart B of this section. 
For these types of services, the use of a widely marketed electronic 
spreadsheet, such as Microsoft's Excel or Corel's Quattro Pro, will be 
the most accessible and understandable method for completing a record 
of use. In order to make use of one of these spreadsheets, it is 
necessary for services to follow a template that organizes the data 
elements prescribed by the Interim Regulations in a way acceptable to 
the needs of SoundExchange. This necessitates that records of use 
maintained by a service in a spreadsheet format must be converted by 
the service into an American Standard Code for Information Interchange 
(``ASCII'') text file that conforms to the format specifications set 
forth below.
    To facilitate the use of spreadsheets by services, the Office is 
proposing that SoundExchange post on its Web site a template for 
creating a record of use of sound recordings using Microsoft's Excel 
spreadsheet and Corel's Quattro Pro spreadsheet. SoundExchange may 
choose to post templates for other spreadsheet programs as well. A 
service may then use the corresponding spreadsheet software and enter 
its record of use data as provided by the template. Any technical 
support necessary for the establishment and use of spreadsheets is the 
responsibility of the service and not SoundExchange.

B. Format Specifications

    What follows is a description of the format specifications that the 
Office proposes must be followed by services in preparing a record of 
use for delivery to SoundExchange, whether the records are in an 
electronic spreadsheet or some other organizational format chosen by 
the service. In proposing these regulations, the Office was guided by 
one of the few points of agreement to arise from the written and oral 
comments submitted in this docket. There are no universal methods of 
operation or uniform business standards for services making use of the 
section 112 and 114 licenses. Some services are highly automated, 
employing computers and software that allow them to readily generate 
play lists and detailed information in electronic format regarding the 
sound recordings that they perform. Others possess less sophisticated 
equipment that utilize varying data storage formats. Accordingly, the 
Office proposes that services be permitted to elect from several means 
of delivering their records of use to SoundExchange and that services 
be permitted to elect whether to submit files with or without headers. 
Services that wish to use different formats or different means of 
delivery may do so with the consent of SoundExchange.
    The Office proposes to adopt organization and formatting 
requirements that represent the essentials for creating records of use 
of sound recordings and for the delivery of the records once they have 
been created. Our purpose in electing such approach is to provide 
SoundExchange with the information it needs to distribute royalties 
collected under the section 112 and 114 licenses, but also permit 
significant flexibility to those services which possess greater 
sophistication and can deliver data in faster and more convenient ways. 
Several of the commenters in this docket have stated that they have 
developed, or are in the process of developing, computer software and 
operating systems that will readily permit the recording and delivery 
of highly detailed information regarding the use of sound recordings. 
Provided that these software programs and operating systems are 
compatible with the systems of the receiving and designated agents 
collecting monies under the section 112 and 114 licenses, they should 
be permitted and encouraged. The Office encourages the continued use 
and development of alternatives that reduce the burden and operating 
expenses of both the services creating the data and the agents 
receiving it.
    1. File Naming. Every file containing records of use must be 
appropriately named. The file name should contain the name of the 
service submitting the file followed by the start and end date of the 
reporting period. The start date and end date should be separated by a 
dash, and the file name should end with a file type extension of 
``.txt''. Starting and ending dates should be in the format of day, 
month and year (DDMMYYYY) where DD is the two-digit day of the log 
period (beginning or end); MM is the two-digit month of the log period; 
and YYYY is the four-digit year of the log period (beginning or end). 
Single-digit days and months should be preceded by a zero (e.g. The 
first day of January of 2004 should be identified as 01012004).

[[Page 21707]]

    The following is an example of a complete file name: 
AcmeMusicCo10102004-30042004.txt.
    2. File type. As discussed above, all files must be delivered in 
ASCII format. This applies to records of use that are maintained by a 
service in spreadsheet format, as well as any other data format that a 
service employs for its records of use. Files must not be attributed 
with any operating system settings that do not allow the file to be 
read using widely used Extract, Transform and Load (``ETL'') software 
(e.g. Oracle SQL Loader, Informatica, Sagent, Teradata, etc.).
    3. File compression. Each report of use should be compressed in one 
of the following formats:

.zip--generated using utilities such as WinZip and/or UNIX zip command
.Z--generated using UNIX compress command
.gz--generated using UNIX gzip command
The zipped file should follow the same naming convention described in 
B1 above. However, instead of the ``.txt'' file extension, the file 
extension should be one of the above-described compression names.

    4. Delivery mechanism. The Copyright Office is proposing four 
separate means for delivery of data to receiving and designated agents. 
As with the other provisions of these proposed regulations, parties are 
encouraged to negotiate alternative acceptable means of delivery if the 
prescribed methods discussed below are not acceptable.
    Of the four acceptable methods of data delivery, two are by 
electronic delivery (FTP and e-mail) and two are by physical delivery 
(CD-ROM and Floppy Diskette). The Copyright Office has considered 
permitting delivery of data files via Internet Web site, but there 
appear to be significant issues regarding security of data delivered to 
Web sites and who would bear the burden of assuring security is 
maintained. We welcome further comment on this issue.
    a. File Transfer Protocol (FTP). File Transfer Protocol is an 
electronic delivery mechanism that permits services using the section 
112 and 114 licenses to deposit a computer file on a password-secured 
site operated by a receiving or designated agent. A service choosing 
FTP as the means of data file delivery must obtain a username and 
password, plus specific instructions for delivery, from the receiving 
or designated agent to which data is being sent. The Office is 
proposing that no later than 60 days from publication of final 
regulations SoundExchange be required to post on a publicly available 
portion of its Web site instructions for applying for a username and 
password and access and delivery instructions for FTP delivery. The 
Office proposes that once a written request has been made for a 
username and password, SoundExchange shall have 15 days to respond.
    b. Electronic mail (e-mail). The other acceptable means of 
electronic delivery of record of use files is electronic mail (e-mail). 
A record of use file may be appended to an e-mail as an attachment and 
sent to the e-mail address identified for SoundExchange. The main body 
of the e-mail should identify: (1) The full name of the service and its 
full address; (2) the name of a contact person and that person's 
telephone number and e-mail address; (3) the start and end date of the 
reporting period; (4) the number of rows in the data file (if using 
headers, beginning with row 15; otherwise, beginning with row 1); and 
(5) the name of the file attached.
    Unlike delivery to an FTP site, there are frequently file size 
limitations imposed by the Internet Service Provider offering the e-
mail service. To avoid the problems likely to be associated with e-
mailing large files, the Copyright Office is proposing to limit the 
size of file attachments to ten megabytes. Services may compress their 
files using the data compression methods described above in order to 
satisfy the ten-megabyte limitation.
    Upon receipt of a report of use, the Office is proposing that 
SoundExchange acknowledge receipt of the e-mail as soon as possible 
through use of an automated reply e-mail to the delivering party.
    c. Compact Disk-Read Only Memory (CD-ROM). A report of use 
contained on a Compact Disk-Read Only Memory (CD-ROM) should be 
delivered to the addresses identified below for SoundExchange. The data 
file must be sufficiently compressed to fit onto a single CD-ROM per 
reporting period. Each CD-ROM submitted shall be accompanied by a cover 
letter identifying: (1) The full name and address of the service; (2) 
the name of a contact person and that person's telephone number and e-
mail address; (3) the start and end date of the reporting period; (4) 
the number of rows in the data file (if using headers, beginning with 
row 15; otherwise beginning with row 1); and (5) the name of the file 
attached.
    d. Floppy diskette. A report of use contained on a floppy diskette 
that measures 3.5 inches in diameter should be delivered to the 
addresses identified for the receiving and designated agents. The 
diskette should be formatted using MS/DOS and be contained on a single 
diskette. No more than one floppy diskette may be submitted per 
reporting period. The diskette must be accompanied by a cover letter 
identifying: (1) The full name and address of the service; (2) the name 
of a contact person and that person's telephone number and e-mail 
address; (3) the start and end date of the reporting period; (4) the 
number of rows in the data file (if using headers, beginning with row 
15; otherwise, beginning with row 1); and (5) the name of the file 
attached.
    5. Delivery addresses. All reports of use should be delivered to 
SoundExchange at the following address: SoundExchange, Inc., 1330 
Connecticut Avenue, NW., 330, Washington, DC 20036; (Phone) 
(202) 828-0120, (Facsimile) (202) 833-2141, (E-mail) 
info@soundexchange.com; https://www.soundexchange.com.
For those services choosing to use CD-ROMs or floppy diskettes which 
require physical delivery to SoundExchange, the Copyright Office does 
not propose to specify whether delivery should be by hand, by courier 
or by U.S. mail. It is recommended, however, that services elect a type 
of delivery service that provides proof that the data file was sent in 
a timely fashion (e.g. certified mail, return receipt requested). It is 
the responsibility of the service to assure that its report of use is 
delivered on time to SoundExchange.
    6. File contents. SoundExchange proposes that data files be 
reported with or without headers at the discretion of the service. The 
services find the option attractive; and consequently, the Office is 
inclined to permit the reporting of data either with or without 
headers.
    In reporting data files, the issue arises as to how many separate 
files of data should be allowed for each reporting period. 
SoundExchange desires only one file per statutory license. Services, in 
particular broadcaster services, would like to submit multiple files of 
data and require the agent receiving data to match up, or overlay, the 
data from one file to another. For example, the National Religious 
Broadcasters Music Licensing Committee (``NRBMLC'') and Salem 
Communications Corp. submit that data identifying artists, song titles, 
albums and marketing labels could be reported in one file, while the 
data concerning the number of performances of the sound recordings 
could be reported in another file. Comments of NRBMLC and Salem 
Communications Corp. at 4-5 (submitted September 30, 2002). They submit 
that reporting in separate files is necessary because information 
regarding the number of

[[Page 21708]]

performances of sound recordings will come from a different source than 
the identifying information for the sound recordings. Allowing 
submission of multiple files of data will, in our view, unduly burden 
the agent processing the data and likely result in confusion and a high 
error rate in attempting to overlay the data. While reporting data in 
multiple files is undoubtedly easier for some services, they have not 
yet demonstrated that such a practice can be done efficiently without 
significant error and expense to the processing agent. We welcome 
further comment from the services as to a solution to this problem.
    a. Files with headers. Submission of data with headers is an issue 
of considerable disagreement between SoundExchange and certain services 
using the section 112 and 114 licenses. See, e.g. Comments of 
SoundExchange at Tab A (submitted September 30, 2002); Comments of 
NRBMLC and Salem Communications Corp. at 4-6 (submitted October 10, 
2002). While the parties agree that submission of files with headers 
should be permitted, the disagreements occur over the information to be 
contained in the headers. SoundExchange proposes that every report of 
use of a sound recording be prefaced with a header that contains 13 
separate rows of information, most of which is devoted to identifying 
the service submitting the report. Certain services counter that 
submission of identification information for each report is redundant 
and unnecessary. Comments of NRBMLC and Salem Communications Corp. at 
passim (submitted October 10, 2002). They advocate a ``flexible'' 
approach to headers that only identifies the fields of data being 
reported (i.e. artist, song title, album, etc.) and permits such 
headers to be embedded in the file as the first line of data or 
provided in a separate file. Further, they advocate that output files 
generated by a service's music scheduling or digital automation 
software should be deemed acceptable if they contain headers 
identifying the data fields contained therein. Comments of NRBMLC and 
Salem Communications Corp. at Tab A, pp. 3-4 (submitted September 30, 
2002).
    In attempting to resolve this dispute, the Copyright Office 
observes that while a balancing of both owner and user interests is 
desirable, we are ultimately charged with the task of creating a system 
that will work. We have repeatedly encouraged the parties to negotiate 
the formatting of data for records of use but without success. 
Broadcaster services assert that their recordkeeping will be in 
multiple formats and that they cannot comply with a single standard. 
SoundExchange asserts that its system will not work unless the format 
it proposes is adopted. Because the statute requires us to adopt record 
of use regulations that will facilitate the distribution of royalties 
to copyright owners of sound recordings, we propose to adopt 
SoundExchange's recommendation for files with headers. In taking this 
approach, the Office observes that services which find the requirements 
for files with headers to be unduly burdensome may instead choose to 
submit their data without headers as provided in subsection (b) below.
    A file with headers is a file that contains, among other things, 
information identifying the service, the period for which data is being 
provided and column headers that identify the data elements in each 
column. The following elements shall occupy the first 13 rows of each 
report of use in the order specified below.
    (i) Name of service. The first row of a report with headers should 
contain the full name of the service making the report. Example: Acme 
Music Service, Inc. The maximum length and description of the service 
name should not exceed 255 alphanumeric characters.
    (ii) Contact person. The second row of a report with headers should 
contain the full name of the contact person responsible for technical 
matters related to the submission of the report of use. The maximum 
length and description of the contact person should not exceed 255 
alphanumeric characters.
    (iii) Street address. The third row of a report with headers should 
contain the full business street address of the service submitting the 
report of use. The ``'' symbol should be used to indicate 
suite or room numbers in the street address. The maximum length and 
description of the street address should not exceed 255 alphanumeric 
characters.
    (iv) City, state and zip code. The fourth row of a report with 
headers should contain the city, state and zip code of the service 
submitting the report of use. The maximum length and description of the 
city, state and zip code should not exceed 255 alphanumeric characters.
    (v) Phone number. The fifth row of a report with headers should 
contain the phone number of the contact person for technical issues of 
the service submitting the report. The maximum length and description 
of the phone number should not exceed 255 alphanumeric characters.
    (vi) E-mail address. The sixth row of a report with headers should 
contain the e-mail address for the contact person for technical issues 
of the service submitting the report. The maximum length and 
description of the e-mail address should not exceed 255 alphanumeric 
characters.
    (vii) Start of reporting period. The seventh row of a report with 
headers should contain the beginning date of the reporting period for 
the service submitting the report.\5\ The date should include the day, 
followed by the month followed by the year (DDMMYYYY). Single-digit 
days or months should be preceded by a zero. Example: the first day of 
January 2006 should appear as 01012006. Thus, the length of the start 
of the reporting period should be eight numeric characters.
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    \5\ The reporting periods are each calendar quarter of the 
year--i.e. the quarters beginning January 1, April 1, July 1 and 
October 1.
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    (viii) End of reporting period. The eighth row of a report with 
headers should contain the last or ending date of the reporting period 
(i.e. March 31, June 30, September 30 or December 31). As with the 
starting date, the date should be eight numeric characters with the 
day, month and year in that order.
    (ix) Report generation date. The ninth row of a report with headers 
should contain the date that the report was generated by the service 
submitting the report. The date should be consistent with the file 
generation date tagged to the zipped container file or the report file 
and be expressed in the eight numeric DDMMYYYY format described above.
    (x) Number of rows. The tenth row of a report with headers should 
contain the total number of rows beyond the fourteenth row in the file. 
The first 13 rows of each report file are for the header information 
only, and the fourteenth row is for the column headers described below. 
There is no limitation on the maximum length and description of the 
number of rows.
    (xi) Text indicator. The eleventh row of a report with headers is 
the identification of the character that delineates the beginning and 
end of a text field. The text indicator is a one-character symbol that 
must be unique and never found in the report's data content. While the 
Copyright Office is not specifying the text indicator at this time, it 
is recommending the adoption of the carat (`` [supcaret] '') symbol as 
an appropriate text indicator. The text indicator differs from a 
delimiter because it is only found at the beginning and end of a text 
field. Examples: [supcaret]Sound Recording Title [supcaret]; 
[supcaret]Featured Artist [supcaret]. Numbers and dates never have text 
indicators.

[[Page 21709]]

    In addition, text indicators must be used even when certain text 
elements are not being reported. For example, if the service does not 
have information for the Marketing Label for a sound recording, the 
service should denote the missing data with a sequence of two 
consecutive text indicators to show that no text for the field is 
available (i.e. ``[supcaret][supcaret]'').
    (xii) Field delimiter. The twelfth row of a report with headers is 
the identification of the character that delineates the end of a data 
field. It differs from a text indicator because it is found at the end 
of both text fields and numeric fields. Field delimiters should not be 
placed at the end of the last data element in a row of data. The field 
delimiter character must be unique and never found in the report's data 
content. As with the text delimiter, the Copyright Office is not 
specifying the field delimiter at this time, but does recommend 
adoption of the pipe (``[bond]'') as an appropriate field delimiter. 
Delimiters must be used even when certain elements are not being 
reported. In this case, the service should denote the blank data field 
with a delimiter in the order in which it would have appeared.
    (xiii) Blank line. The thirteenth row of a report with headers is 
the carriage return and should be left blank.
    The above describes the required first 13 rows of a report with 
headers. The fourteenth row should contain the report headers which are 
prescribed in the Interim Regulations (Featured Artist, Sound Recording 
Title, Marketing Label, etc.). See 37 CFR 270.1 et seq. Underscores 
(``--'') should appear in the report header between elements of each 
field name to show separation in the data field titles. Report header 
file names should be listed using the same text indicator and field 
delimiter indicated in the header.
    The fifteenth row of the data file is where the actual records of 
use of sound recordings shall begin to appear. The data text fields 
should be reported in upper case characters. All featured performers 
should be reported as FIRST NAME--LAST NAME, where the name of the 
featured performer is an individual. Abbreviations are not permitted. 
Services should take care in providing data that conforms with the data 
that appeared on the physical product containing the sound recording 
that was supplied to or used by the service, and avoid using 
colloquialisms or short-handed methods of data entry (ex. ``JENNIFER--
LOPEZ'' is the correct data entry for the artist, not ``J--LO'').
    A carriage return must be at the end of each line and all data for 
one sound recording must be on a single line.
    The following is a table summarizing the first 13 rows of a file 
with headers, including identification of the data that is required for 
each field, followed by an example.

----------------------------------------------------------------------------------------------------------------
                                   Field definition (Do not
  Row No. (Do not include row      include field definition                          Example
           numbers)                      description)
----------------------------------------------------------------------------------------------------------------
1.............................  Service full name.............  ACME MUSIC SERVICE.
2.............................  Contact Person................  JOHN DOE.
3.............................  Street Address................  1000 WASHINGTON STREET.
4.............................  City, State, Zip..............  WASHINGTON, DC 10000.
5.............................  Phone.........................  202-555-1212.
6.............................  E-mail........................  DOE@ACMEMUSIC.COM.
7.............................  Start of Reporting Period       01012006.
                                 (DDMMYY).
8.............................  End of Reporting Period         31032006.
                                 (DDMMYY).
9.............................  Report Generation Date          15042006.
                                 (DDMMYY).
10............................  Number of rows................  60000.
11............................  Text Indicators...............  [supcaret].
12............................  Field delimiters..............  [bond].
13............................  Blank line....................
----------------------------------------------------------------------------------------------------------------

    b. Files without headers. The previous regulation adopted by the 
Copyright Office for records of use by preexisting subscription 
services, 37 CFR 270.2(g), specifies the reporting of data without 
headers. These provisions have operated successfully, and the Office is 
proposing that they be adopted in this docket with some slight 
modifications to avoid duplication of information. Data files without 
headers should meet the following format requirements:
    (1) ASCII delimited format, using pipe ([bond]) characters as 
delimiters, with no headers or footers;
    (2) Carets ([supcaret]) should surround strings;
    (3) No carets ([supcaret]) should surround dates and numbers;
    (4) A carriage return must be at the end of each line;
    (5) All data for one record should be on a single line; and
    (6) Abbreviations within data fields are not permitted (ex. The 
artist ``JOHN LEE HOOKER'' should not be abbreviated as ``J.L. 
HOOKER'').

All text fields should be reported in upper case characters (ex. ``THE 
ROLLING STONES''). All featured performers should be reported as FIRST 
NAME--LAST NAME, where the name of the featured performer is the name 
of an individual. Services should take care in providing data that 
conforms with the data that appeared on the physical product containing 
the sound recording that was supplied to or used by the service, and 
avoid using colloquialisms or short-hand methods of data entry (ex. 
``JENNIFER --LOPEZ'' is the correct data entry for the artist, not ``J 
--LO'').

    The following are two examples of a file without headers reporting 
a record of use of the sound recording ``Mixed Emotions'' by the 
Rolling Stones. In the first example, the Acme Music Service is 
reporting the Album Title and the Marketing Label in lieu of the 
International Sound Recording Code (``ISRC'') and is reporting Actual 
Total Performances in lieu of Aggregate Tuning Hours (``ATH''), Channel 
or Program Name and Play Frequency. See 69 FR 11515, 11524 (March 11, 
2004). In the second example, My Music Service is reporting the ISRC in 
lieu of the Album Title and Market Label and is reporting ATH in lieu 
of the Actual Total Performances. Id.

Example 1

[supcaret]ACME MUSIC SERVICE[supcaret][bond] 
[supcaret]F[supcaret][bond][supcaret] THE ROLLING 
STONES[supcaret][bond][supcaret]MIXED 
EMOTIONS[supcaret][bond][supcaret] STEEL WHEELS[supcaret][bond] 
[supcaret]VIRGIN[supcaret][bond][supcaret] 100.00[supcaret][bond] 
[bond] [bond]

Example 2

[supcaret]MY MUSIC 
SERVICE[supcaret][bond][supcaret]F[supcaret][bond][supcaret] THE 
ROLLING STONES[supcaret][bond][supcaret]MIXED 
EMOTIONS[supcaret][bond][supcaret] USSM12345678[supcaret][bond] [bond] 
[bond]7650.00 [bond][supcaret]ROCK[supcaret][bond]25.00

[[Page 21710]]

List of Subjects in 37 CFR Part 270

    Copyright, Sound recordings.

Proposed Regulations

    In consideration of the foregoing, the Copyright Office is 
proposing to amend part 270 of 37 CFR to read as follows:

PART 270--NOTICE AND RECORDKEEPING REQUIREMENTS FOR STATUTORY 
LICENSES

    1. The authority citation for part 270 continues to read as 
follows:

    Authority: 17 U.S.C. 702.

    2. Paragraph (a) in Sec.  270.2 is revised to read as follows:


Sec.  270.2  Reports of use of sound recordings under statutory license 
for preexisting subscription services.

    (a) General. This section prescribes the rules for the maintenance 
and delivery of reports of use for sound recordings under section 
112(e) or section 114(d)(2) of title 17 of the United States Code, or 
both, by preexisting subscription services.
* * * * *
    3. Section 270.3 is amended as follows:
    a. By revising paragraph (a); and
    b. By adding a new paragraph (d).
    The revision and addition read as follows:


Sec.  270.3  Reports of use of sound recordings under statutory license 
for nonsubscription transmission services, preexisting satellite 
digital audio radio services, new subscription services and business 
establishment services.

    (a) General. This section prescribes rules for the maintenance and 
delivery of reports of use of sound recordings under section 112(e) or 
section 114(d)(2) of title 17 of the United States Code, or both, by 
nonsubscription transmission services, preexisting satellite digital 
audio radio services, new subscription services, and business 
establishment services.
* * * * *
    (d) Format and Delivery. (1) Electronic format only. Reports of use 
must be maintained and delivered in electronic format only, as 
prescribed in paragraphs (d)(2) through (8) of this section. A hard 
copy report of use is not permissible.
    (2) Use of spreadsheet. Commercially available spreadsheets 
(Examples: Microsoft Excel, Corel Quattro Pro) may be utilized for 
maintaining reports of use: Provided, that the spreadsheet format is 
converted into an ASCII text file that conforms to the format 
specifications set forth below. SoundExchange shall post and maintain 
on its Internet website a template for creating a report of use using 
Microsoft's Excel spreadsheet and Corel's Quattro Pro spreadsheet and 
instruction on how to convert such spreadsheets to ASCII text files 
that conform to the format specifications set forth below. However, 
technical support and cost associated with the use of spreadsheets is 
the responsibility of the service submitting the report of use.
    (3) Delivery mechanism. The data contained in a report of use may 
be delivered by File Transfer Protocol (FTP), e-mail, CD-ROM, or floppy 
diskette according to the following specifications:
    (i) A service delivering a report of use via FTP must obtain a 
username, password and delivery instructions from SoundExchange. 
SoundExchange shall not later than [DATE 60 DAYS FROM DATE OF 
PUBLICATION OF FINAL RULE IN THE FEDERAL REGISTER] post on a publicly 
available portion of its Web site instructions for applying for a 
username, password and delivery instructions. SoundExchange shall have 
15 days from date of request to respond with a username, password and 
delivery instructions.
    (ii) A service delivering a report of use via e-mail shall append 
the report as an attachment to the e-mail. The main body of the e-mail 
shall identify:
    (A) The full name and address of the service;
    (B) The contact person's name, telephone number and e-mail address;
    (C) The start and end date of the reporting period;
    (D) The number of rows in the data file. If the report of use is a 
file using headers, counting of the rows should begin with row 15. If 
the report of use is a file without headers, counting of the rows 
should begin with row 1; and
    (E) The name of the file attached.
    (iii) A service delivering a report of use via CD-ROM must compress 
the reporting data to fit onto a single CD-ROM per reporting period. 
Each CD-ROM shall be submitted with a cover letter identifying:
    (A) The full name and address of the service;
    (B) The contact person's name, telephone number and e-mail address;
    (C) The start and end date of the reporting period;
    (D) The number of rows in the data file. If the report of use is a 
file using headers, counting of the rows should begin with row 15. If 
the report of use is a file without headers, counting of the rows 
should begin with row 1; and
    (E) The name of the file attached.
    (iv) A service delivering a report of use via floppy diskette must 
compress the reporting data to fit onto a single floppy diskette per 
reporting period. Each floppy diskette must measure 3.5 inches in 
diameter and be formatted using MS/DOS. Each floppy diskette shall be 
submitted with a cover letter identifying:
    (A) The full name and address of the service;
    (B) The contact person's name, telephone number and e-mail address;
    (C) The start and end date of the reporting period;
    (D) The number of rows in the data file. If the report of use is a 
file using headers, counting of the rows should begin with row 15. If 
the report of use is a file without headers, the counting of the rows 
should begin with row 1; and
    (E) The name of the file attached.
    (4) Delivery address. Reports of use shall be delivered to 
SoundExchange at the following address: SoundExchange, Inc., 1330 
Connecticut Avenue, NW., 330, Washington, DC 20036; (Phone) 
(202) 828-0120; (Facsimile) (202) 833-2141; (E-mail) 
info@soundexchange.com.
    (5) File naming. Each data file contained in a report of use must 
be given a name by the service followed by the start and end date of 
the reporting period. The start and end date must be separated by a 
dash and in the format of day, month and year (DDMMYYYY). Each file 
name must end with the file type extension of ``.txt''. (Example: 
AcmeMusicCo01012005-31032005.txt).
    (6) File type and compression. (i) All data files must be in ASCII 
format. Files may not be attributed with any operating system settings 
that do not allow the file to be read using widely used Extract, 
Transform and Load (ETL) software.
    (ii) A report of use must be compressed in one of the following 
formats:
    (A) .zip--generated using utilities such as WinZip and/or UNIX zip 
command;
    (B) .Z--generated using UNIX compress command; or
    (C) .gz--generated using UNIX gzip command.
    Zipped files shall be named in the same fashion as described in 
paragraph (d)(5) of this section substituting the ``.txt.'' file 
extension with the applicable compression name described in this 
paragraph.
    (7) Files with headers. (i) If a service elects to submit files 
with headers, the following elements, in order, must occupy the first 
14 rows of a report of use:
    (A) Name of service;
    (B) Name of contact person;
    (C) Street address of the service;

[[Page 21711]]

    (D) City, state and zip code of the service;
    (E) Telephone number of the contact person;
    (F) E-mail address of the contact person;
    (G) Start of the reporting period (DDMMYYY);
    (H) End of the reporting period (DDMMYYYY);
    (I) Report generation date (DDMMYYYY);
    (J) Number of rows data file, beginning with 15th row;
    (K) Text indicator;
    (L) Field delimiter;
    (M) Blank line; and
    (N) Report headers (Featured Artist, Sound Recording Title, etc.).
    (ii) Each of the rows described in paragraphs (d)(7)(i)(A) through 
(F) of this section must not exceed 255 alphanumeric characters. Each 
of the rows described in paragraphs (d)(7)(i)(G) through (I) of this 
section should not exceed eight alphanumeric characters. There is no 
limitation on the maximum length and description in paragraph 
(d)(7)(i)(J) of this section.
    (iii) Data text fields, as required by paragraph (c) of this 
section, begin on row 15 of a report of use with headers. The data text 
fields must be in upper case characters and a carriage return must be 
at the end of each row thereafter.
    (8) Files without headers. If a service elects to submit files 
without headers, the following format requirements must be met:
    (i) ASCII delimited format, using pipe ([bond]) characters as 
delimiters, with no headers or footers;
    (ii) Carats ([supcaret]) should surround strings;
    (iii) No carats ([supcaret]) should surround dates and numbers;
    (iv) A carriage return must be at the end of each line;
    (v) All data for one record must be on a single line;
    (vi) Abbreviations within data fields are not permitted; and
    (vii) All text fields must be reported in upper case characters.

    Dated: April 22, 2005.
David O. Carson,
General Counsel.
[FR Doc. 05-8435 Filed 4-26-05; 8:45 am]
BILLING CODE 1410-33-P