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2

3.  To bring monetary returns to the Institution.  It was agreed that the direct returns anticipated from this contract will be relatively modest, probably averaging about $160,000 annually, and that they would be used principally to recruit and develop the Institution's own media capability.  Indirect financial benefits may be anticipated in such areas as increased circulation of the [[underlined]] Smithsonian [[/underline]] magazine and memberships in the Associates program.

There are two principal problems in entering into the contract:

1.  The producer desires the maximum degree of exclusivity in use of the Smithsonian name, both for commercial and educational television programs, in order to assure potential sponsors that there will not be competitive programs with a Smithsonian identification.

2.  The producer also proposes a contract duration of four years (until 30 June 1977), including exclusivity provisions for that period and terminable only if less than two programs are presented in the first year and less than three in subsequent years.  In addition, the producer retains distribution rights to all programs produced for an additional ten years (until 30 June 1987).