Testimony Before the Subcommittee
on Courts and Intellectual Property
Committee on the Judiciary
U.S. House of Representatives
February 12, 1998
President, The SunShine Pages
On Behalf of
the Association of Directory Publishers
78 South Street
P.O. Box 157
Wrentham, MA 02093
(508) 384-0850
Mr. Chairman and members of the subcommittee, thank you for inviting me to testify on H.R. 2652, the "Collections of Information Antipiracy Act." I am speaking here today on behalf of the Association of Directory Publishers (ADP), a century-old international trade association of over 180 independent telephone directory publishers who employ thousands of workers throughout the country. We provide consumers with telephone directories that include white and yellow pages listings, plus community information. Our products are indispensable links in the communications network that binds our communities together.
My company, The SunShine Pages, publishes 1.5 million directories that are delivered free to 130 cities and towns in Louisiana, Florida, Mississippi and Tennessee. We generate our revenues by selling advertising, which puts us in direct competition with local telephone companies, who also publish telephone directory advertising.
Consumers have benefited greatly from the competition that ADP's members have brought to the directory industry. Many of the innovations we have introduced are now standard in directories today. Independent publishers were the first to introduce coupons and maps to directory products. We created the first community sections with helpful local information, such as frequently called service and government numbers, school information, sports schedules, and seating diagrams for auditoriums and stadiums. Recently, we were the first publishers to add zip codes to the white page listings, again expanding the usefulness of our products. These enhancements were quickly copied by phone company publishers, thus making all phone books more useful to consumers and businesses.
As directory publishers, we need complete and up-to-date subscriber list information to produce our products. Local phone companies must gather this information as part of providing local phone service. They therefore have sole access to such information and monopoly control over it.
The local phone companies' directory publishing arms currently control 93% of the directory market, and the telephone companies have long used their control over subscriber list information to restrict our competitive access to this essential data. Their anti-competitive practices include unreasonable prices, refusal to sell updates, and even outright refusal to sell listings at any price or on any terms.
I want to commend you, Mr. Chairman, for your effort to arrive at balanced legislation through careful examination of the implications of database protection legislation on the wide range of database information, and particularly for examining special circumstances surrounding some databases. ADP is especially grateful to you for including in your bill Section 1205(d), to ensure the preservation of the competition policy set forth in the 1996 Telecommunications Act regarding independent directory publishers' access to subscriber listing information. Section 1205(d) provides that "[n]othing in this chapter shall affect the operation of section 222(e) of the Communications Act." We believe that this provision, with some key modifications, can ensure that directory publishers continue to have access to listings as authorized by both the Supreme Court in Feist and the Telecommunications Act. We look forward to working with you to achieve this goal.
In 1996, as part of the historic Telecommunications Act and in response to years of anticompetitive behavior by phone companies, Congress established a clear federal guarantee of competition in the telephone directory business. In the new Section 222(e), Congress enunciated in plain terms our right to access subscriber list information under reasonable rates, terms and conditions. Sections 222(e) and 222(f)(3) of the Communications Act provide:
Subscriber List Information. - Notwithstanding subsections (b), (c), and (d), a telecommunications carrier that provides telephone exchange service shall provide subscriber list information gathered in its capacity as a provider of such service on a timely and unbundled basis, under nondiscriminatory and reasonable rates, terms, and conditions, to any person upon request for the purpose of publishing directories in any format. [47 U.S.C. 222(e)]
Subscriber List Information. - The term 'subscriber list information' means any information -
The legislative history on this provision clearly documents the abuses ADP members suffered over the past decade. Some examples include: local exchange carriers charging excessive and discriminatory prices, requiring us to purchase listings on a bundled statewide basis when we only needed one community, and, in some cases, outright refusals to sell listings or updates. Sec. 222(e) was enacted to prevent telephone companies from exercising their de facto monopoly over essential factual information - which arises entirely as a byproduct of their provision of regulated local telephone exchange service - to restrict or prevent competition in the unregulated and potentially competitive directory advertising business. See, e.g., House Rept. 104-204, Part 1, pp. 89-90; 142 Cong. Rec. E184 (daily ed. Feb. 6, 1996)(statement of Rep. Paxon); 142 Cong. Rec. H1160 (daily ed. Feb. 1, 1996)(statement of Rep. Barton).
In enacting this provision in 1996, Congress intended to build on our pre-existing ability to copy published listings, as authorized under the 1991 Feist case. The statute was meant to promote reasonable licensing agreements, not revoke the ability of independent publishers to copy listings in cases where licensing agreements are not concluded.
The Feist case is named for Tom Feist, who is an ADP member. Tom was left with no choice but to copy listings in order to provide consumers a convenient, one-book directory covering eleven different service areas, because one of the telcos refused to license its listings to him. As you know, the Supreme Court ruled in Tom's favor, concluding that "[f]acts, whether alone or as part of a compilation, are not original and therefore may not be copyrighted." (Feist Publications v. Rural Telephone Service Co., 499 U.S. 340, 350 (1991)) Nor could the phone company secure a copyright in its compilation of these facts, because the coordination and arrangement of telephone listings in alphabetical order is "not only unoriginal, it is practically inevitable." (Id. at 363) Moreover, the Court noted that the phone company's selection of listings lacked the requisite originality because the state required the company to publish the names and numbers of its subscribers as a condition of its monopoly franchise. (Id.)
As currently drafted, H.R. 2652, even with the provision recognizing Sec. 222(e) of the Communications Act, could foreclose our ability to access listings under Feist, and thus unintentionally push back the advancement of competition in the directory business.
H.R. 2652 prohibits extraction or use of information so as to harm another person's "actual or potential market for a product or service." The standard of "harm" to an "actual or potential market" is sufficiently broad to allow a phone company to argue that any use of white pages information could adversely affect its own directory business, or other potential markets it may enter using that information. We are thus concerned that H.R. 2652, as presently drafted, would terminate our access to listings by deeming use of white page listings a misappropriation.
The need of independent publishers to continue to rely on the ability to access listings -- as affirmed by the Supreme Court in Feist -- is best demonstrated by the fact that the abuses Congress sought to end in enacting Section 222(e) continue unabated today. When we cannot work out a reasonable licensing arrangement with the phone companies, we are left with no alternative but to exercise the "last resort" option of doing what Tom Feist did, copy listings out of the phone company's book.
ADP believes that many local phone companies are violating Section 222(e). Actual examples of such illegal conduct include:
We are fearful that even more egregious abuses would occur without Feist. The prices telephone companies charge independent publishers to license listings now are constrained, as a practical matter, primarily by the right of independent publishers to copy white pages listings. If that right is removed and copying is now deemed a misappropriation, particularly in the absence of an FCC rulemaking establishing what constitutes a reasonable price, then Congress' goal of ensuring reasonable pricing under Section 222(e) of the Communications Act will be seriously undermined.
The Copyright Office has recognized the special circumstances relating to phone listings in its August 1997 Report on Legal Protection for Databases. In cases involving sole source data, of which telephone subscriber information is a "prototypical example," the Copyright Office observes, "[u]nless the producer chooses to make such data freely available, it is simply not possible for anyone else to obtain it independently." (Copyright Office Report, 1997, p. 102)
Dr. Laura D'Andrea Tyson similarly has noted the special circumstances relating to telephone listings in her study, Statutory Protection for Databases: Economic & Public Policy Issues. She observes, "the factual situations of the Feist case [i.e., telephone listings] are in reality much closer to the kinds of concerns addressed in the antitrust law under the rubric of so-called 'essential facilities' than they are to the kinds of concerns raised by a typical 'database piracy' case." She concludes, "[w]hen data is generated by a government-created monopolist, it is not appropriate to allow the monopolist to control database products building on that data." (Tyson and Sherry, 1997, pp. 24-25)
Our goal is to maintain the access to listings as guaranteed under Section 222(e) and the Feist decision. We believe it is possible to craft narrowly-tailored language that will avoid unintended harm to our independent publishers and is consistent with federal policies promoting competition in the telephone directory marketplace. On behalf of all independent publishers, I want to thank you for listening to our concerns.