Compulsory Licensing: Government's Helping Hand
A central part of the success of the cable industry was the creation of the cable compulsory license. This permission allows cable systems to deliver copyrighted programs to their subscribers; in exchange, they pay a fee set not by the marketplace but by the government. The payment is delivered to the Copyright Office, which then arranges for its distribution to copyright owners. This copyright policy compromise was essential in enabling the cable industry to move into the media big leagues. A similar compromise has, as we will see, helped the direct satellite industry assume a significant role in delivering content to the home (Figure 5-1).
To understand the tension in the compulsory ...