Washington -- A federal appeals court heard arguments last
week over the legality of the 27-cent-per-subscriber, per-month rate that satellite
providers pay in copyright fees.
The Librarian of Congress instituted the fee last year, on
the recommendation of a special copyright panel.
John Seiver, representing the satellite industry, told a
panel of the U.S. Court of Appeals for the District of Columbia Circuit that the 27-cent
rate was at least 16.5 cents too high under the cost model recommended to the Librarian:
the rates that cable operators pay for national cable networks.
Seiver said direct-broadcast satellite carriers shoulder
retransmission costs roughly equivalent to 10 cents per subscriber, per month, which cable
operators do not shoulder for cable networks.
"Why should we pay [copyright] owners 10 cents for
something that we do?" Seiver asked the three-judge panel.
Seiver added that the comparison to cable was faulty
because national cable networks allow operators to insert local ads (worth about 6.5
cents), while DBS carriers are barred from altering the broadcast signals that they
Robert Alan Garrett, an attorney who represented
professional-sports leagues in their capacity as copyright-owners, said the satellite
industry failed to provide the copyright panel with evidence to explain why its fees
should be decreased because DBS carriers are prohibited from inserting advertisements.
Department of Justice attorney Frank Rosenfeld,
representing the Librarian, said the process leading to the 27-cent rate was not
arbitrary, adding that the copyright panel prepared "a detailed report" for the
States News Service
Ted Hearn contributed to this story.