Audio Home Recording Act

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Audio Home Recording Act of 1992 (AHRA) amended the US Copyright Act by adding chapter 10 "DIGITAL AUDIO RECORDING DEVICES AND MEDIA". The act was prompted by the release of the Sony Digital Audio Tape (DAT). The RIAA, concerned that consumers ability to make perfect digital copies of music would destroy the market for audio recordings, had lobbied Congress to pass the legislation.

AHRA brought new measures to prevent prohibition of manufacturing, importing, or selling of digital records and allowing consumers to be exempt from infringement for private noncommercial recordings in return for a royalty for the music being copied, a royalty for every recorder, and serial copy protection built into home devices. President George H. W. Bush signed the AHRA into law in 1992 proclaiming " S. 1623 [AHRA] will ensure that American consumers have access to equipment embodying the new digital audio recording technology. It also protects the legitimate rights of our songwriters, performers, and recording companies to be fairly rewarded for their tremendous talent, expertise, and capital investment."

1 Contents of the AHRA
2 AHRA and the No Electronic Theft (NET) Act
3 Collecting AHRA Royalties
4 AHRA and the DMCA
5 External links

[edit] Contents of the AHRA

The AHRA;

Exempts media primarily marketed and most commonly used by consumers either for the purpose of making copies of motion pictures or other audiovisual works or for the purpose of making copies of nonmusical literary works, including computer programs or data bases (section 1001(4)(B)(ii))
Requires digital recorders to use the Serial Copy Management System (SCMS), which prevents digital dubbing beyond one generation (section 1002(a))
Prohibits manufacture and sale of devices whose primary purpose is to circumvent SCMS (section 1002(c))
Imposes a "royalty" on digital recorders (section 1004(a))
Imposes a "royalty" on blank digital media (section 1004(b))
Establishes a procedure for distributing the collected "royalty" to artists, performers, writers, and publishers (sections 1006 and 1007)
Prohibits infringement action of copyright based on the manufacture, importation, or distribution of a digital audio recording device, a digital audio recording medium, an analog recording device, or an analog recording medium, or based on the noncommercial use by a consumer of such a device or medium for making digital musical recordings or analog musical recordings. (Section 1008)
The act failed to define "noncommercial use by a consumer" however "In short, the reported legislation [Section 1008] would clearly establish that consumers cannot be sued for making analog or digital audio copies for private noncommercial use." (House Report No. 102-780(I), August 4, 1992)
Allows ignorance of actions dealing with SCMS as a defense to copyright infringement (Section 1009(3)) - This is probably superseded by the DMCA (see below)

[edit] AHRA and the No Electronic Theft (NET) Act

The RIAA claims that any copy of a phonorecord has commercial value. Thus, even though a royalty has already been paid to the labels for the copy of the music made on the digital recorder, and on the blank digital media, they apparently wish to make it criminal to record or copy any CD.

The No Electronic Theft Act (NET Act), enacted in 1997, amends section 101 so that financial gain (commercial uses) include;

The term "financial gain" includes receipt, or expectation of receipt, of anything of value, including the receipt of other copyrighted works.

The changes effected in section 101 effectively gut the consumer copies for noncommercial use if you trade mix CDs, or even receive anything in return for a copy of CD, including a home-cooked meal. The RIAA even argues, just as the MPAA does for DVDs, that an archive/backup copy to protect the consumer's investment or a custom mix CD has value.

The act also makes it criminal to;

Make 1 or more copyrighted works, which have a total retail value of more than $1,000
In any 180-day period, at least 10 copies or phonorecords, of 1 or more copyrighted works, with a which have a total retail value of more than $2,500

As the RIAA tends to inflate damages, in order to elevate infringement to criminal levels, any 10 copies will have a valuation by the RIAA of $2,500 or more regardless of actual market value. In effect consumers are limited to making only 10 recordings of their records or CDs in a 180 day period.

[edit] Collecting AHRA Royalties

Under the AHRA, royalties collected by the Copyright Office on digital recording devices and digital recording media are divided into two separate funds, the Musical Works Fund and the Sound Recordings Fund. One third of the royalties goes to the Musical Works Fund, which splits its cut 50/50 between writers (distributed by ASCAP, BMI, and SESAC) and music publishers (distributed by Harry Fox). These parties receive royalties according to the extent to which their recordings were distributed or broadcast.

The remaining two thirds of the royalties are placed in the Sound Recordings Fund. Four percent of these funds are taken off the top for nonfeatured musicians and vocalists (distributed by the American Federation of Musicians (AFM) and AFTRA), what remains is split 60/40 between two sets of “interested copyright parties.” Interested copyright parties, a heretofore unknown category in copyright law, is defined by the act as featured artists(40%), and the owners of the right to reproduce sound recordings (60%). These parties receive royalties through the Alliance of Artists and Recording Companies according to the extent to which their recordings were distributed.

The inclusion of this last group, reproduction rights holders, is unprecedented in copyright law. Almost thirty-nine percent of the royalties collected under the AHRA go not to songwriters and musicians, but to the record labels who own the right to copy and distribute their recordings. The justification for this cross subsidy is that the copying enabled by the digital technology is a loss of profits for the recording industry, and that they should be compensated for this loss.

[edit] AHRA and the DMCA

In 1998 Congress passed the controversial Digital Millennium Copyright Act of 1998 (DMCA) after significant lobbying in particular from the MPAA, RIAA, and BSA.

The DMCA language reads as follows;

No person shall circumvent a technological measure that effectively controls access to a work protected under this title (section 1201(1)(A)).

No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that -

(A) is primarily designed or produced for the purpose of circumventing protection afforded by a technological measure that effectively protects a right of a copyright owner under this title in a work or a portion thereof;

(B) has only limited commercially significant purpose or use other than to circumvent protection afforded by a technological measure that effectively protects a right of a copyright owner under this title in a work or a portion thereof; or

(C) is marketed by that person or another acting in concert with that person with that person's knowledge for use in circumventing protection afforded by a technological measure that effectively protects a right of a copyright owner under this title in a work or a portion thereof. (Section 1201 (b)(1))

While to some it may seem that DMCA causes uncrippled digital recorders to become banned it does not. But digital recorders, despite the royalty already paid on the devices, effectively become useless because more and more digital audio is protected by DRM and can not be copied by "consumer" market digital recorders.

Several companies such as Macrovision and SunnComm have devised DRM for the "analog music hole" which will also add DRM to analog music.

Potentially, all benefits to the consumer that were given in the AHRA may have effectively been overruled by later legislation while the royalties are still being collected.