These estimates sum to $44.4 million in copyright owners income from performance fees attributable to sound recordings, an increase of 283% over the level of 1963, as reported in the 1965 Glover Statement. In terms of the estimated mechanical royalties, it will be noted in footnotes "a" and "b" of Exhibit 3 that there are two estimates provided. The footnotes indicate that the two estimates are from different surveys, and it explains our rules for the use of each. The lower estimate ($77 million in 1973 and $79 million in 1974) is from a lengthy financial survey which was first conducted by CRI in 1973 and later updated in 1974 and 1975. It is discussed in detail below under the notes to Exhibit 5. The higher estimate is from a short, special 34-company survey which CRI conducted in 1975 in order to obtain the most recent information on mechanical royalties paid. It was conducted as follows: A two-question survey was sent to 96 record companies - -- some were and hence, mechanical royalties paid. Thus the figure of $83 million for mechanical royalties paid in 1974 is a highly reliable On the next four pages following, the memorandum introducing the short survey, the one-page questionnaire, the names of the respondent firms, and the raw survey results are provided. 127 MEMORANDUM December 2, 1974 TO: FROM: SUBJECT: Record Companies Cambridge Research Institute, Cambridge, Massachusetts 1973 and 1974 Statistics on Mechanical Fees Paid by the During recent Senate hearings on the Copyright Revision Bill, questions were raised about the total amount of mechanical fees paid by the record industry. In order to illustrate the severe impact on the record industry of raising mechanical fees from 2¢ (under existing copyright law) to 34 (under the copyright bill passed by the Senate in September 1974), there is an urgent need to collect statistics on the mechanical fees paid by as many record companies as possible. Could you, therefore, please fill in the attached questionnaire and return it by January 15. The following procedure has been established so your company's financial data will be handled in a confidential manner: After you have completed the enclosed form keep one copy J. K. Lasser & Company, 666 Fifth Avenue, New York, As you will notice, your forms have been pre-coded with The financial data you send to the accountants will be 57-786 76 pt. 3 10 128 Only financial statistics on record and tape operations in the These figures can be estimates if necessary, but please indicate if they are. PLEASE MAIL THIS INFORMATION BY JANUARY 15, 1975. ABC Bee Record Companies Which Responded to the Questionnaire Entitled "RIAA SURVEY OF MECHANICAL FEES PAID BY RECORD COMPANIES IN 1973 and 1974" ABC/Dunhill Records Alshire International, Inc. A & M Records, Inc. Arista Records Atlantic Recording Corp. Bee Gee Records Buddah Records Capitol Records, Inc. Challenge Records Cinnimon, c/o Goldband Records Columbia/Records Group Disneyland/Vista Records Elektra/Asylum/Nonesuch Records GNP Crescendo Records GRT Corporation Hickory Records, Inc. Icka-Delick-Music & Records Corp. London Records Longines - Symphonette Recording Society MCA Records, Inc. Phonogram, Inc. Pickwick International, Inc. Polydor, Inc. RCA Records Savoy Records, Inc. Sussex Records 20th Century Records United Artists Music & Records Group, Inc. Thomas J. Valentino, Inc. Warner Bros. Records Word Records 130 Only financial statistics on record and tape operations in the Net Sales of Records and Tapes (All domestic and export sales debts arising from record club 2 These figures can be estimates if necessary, but please indicate if they are. PLEASE MAIL THIS INFORMATION BY JANUARY 15, 1975. |