Playing music in a business setting can enhance the atmosphere and improve customer satisfaction. However, many business owners may not be aware of the legal requirements involved in music licensing. Whether it's streaming music, hiring live bands, or hosting karaoke nights, understanding these rules is crucial to avoid fines and legal issues.
Music played publicly is considered a public performance and is protected as intellectual property. Performing Rights Organizations (PROs) such as BMI, ASCAP, SESAC, and GMR collect fees on behalf of songwriters, composers, and publishers to ensure they are compensated when their music is used publicly. Business owners need licenses from one or more PROs to legally play copyrighted music.
Some might think that personal streaming accounts like Spotify or Pandora suffice for public performances. However, these accounts are not intended for such use. Non-compliance with licensing requirements can lead to significant fines.
Even if a business hires cover bands or hosts live performances, it must secure the appropriate licenses since the performed music is likely copyrighted. The responsibility lies with the business owner rather than the performers.
Obtaining a license through a PRO involves identifying which organizations represent the artists whose music will be played. The four major PROs include BMI (Broadcast Music Inc.), ASCAP (American Society of Composers, Authors, and Publishers), SESAC (Society of European Stage Authors and Composers), and GMR (Global Music Rights). Each has an online portal where businesses can apply for licenses by providing information about their type of establishment, size, and method of playing music.
Licensing fees vary based on factors like business size and frequency of music use. Many PROs offer annual flat rates for small businesses but may adjust fees according to specific situations. Licenses must be renewed annually with reminders typically sent by PROs.
For those seeking alternatives to traditional PRO licenses, commercial music accounts offer convenient solutions while ensuring legal compliance with curated options designed for businesses.
Sirius XM for Business provides over 240 curated channels covered under its subscription agreement with PROs. Similarly, Pandora offers "Pandora for Business," allowing licensed playback from various organizations including BMI and ASCAP. Soundtrack Your Brand offers similar services covering background music through ACAP, BMI, and GMR subscriptions.
There exists a "home-style" exemption allowing certain small food service or drinking establishments to rebroadcast radio or TV without needing a license if they meet specific criteria regarding space size and speaker count.
In summary: using music legally by adhering to licensure laws protects businesses from potential legal issues while enhancing customer experience through soundscapes tailored specifically toward them.
For further inquiries on licensing your business for musical activities involving streaming services or live performances contact info@nfib.org.
