I recently heard from a number of bands that were lamenting how many venues were now cancelling music performances. The reason behind it all, music licensing fees.
This comes as our home base city of Pittsburgh, PA is actively trying to encourage live music.
It’s the responsibility of any venue that plays any form of copyrighted music (live or recorded) to obtain and pay for the proper licences. The problem is many venue owners are either uneducated or simply think they can ignore the rules. Either can be very costly when a group that collects these fees comes calling and these days they are cracking down on everyone from small bars to restaurants.
Performing rights organizations (“PROs”), such as BMI, ASCAP and SESAC, act as intermediaries between restaurants and songwriters to protect intellectual property. Venues pay a fee to the PROs for a blanket license that grants permission to use all of the music each organization represents. This applies to everything from live music to background music. Each PRO represent certain songwriters and songs. Many venues decide to only pay fees to one of the three PRO. That can be dangerous. If you play music licensed by a PRO you do not have a license from, you can be held liable for copyright infringement. I have seen legal action taken over one single song the repeatedly played.
I can’t tell you how many times I’ve been in places that are streaming music. Pandora’s “terms of use” specifically prohibit businesses from streaming music without setting up and complying with the terms of a paid DMX/Pandora business account. If a bar or restaurant has a business account with Pandora or SiriusXM and the music is used only for background, the establishment does not allow dancing to the music, or charge a cover fee to enter, then the provider of the music such as Pandora or SiriusXM, should be paying the public performance fees to BMI, ASCAP and SESAC. Should the business have any additional music, live bands, DJs, or Karaoke, they need to license with the PROs directly for those uses.
How bad is it if you get caught? Federal penalties for using music without permission can be high, with each musical composition used without authorization entitling copyright owners to damages between $750 to $30,000, or more. That’s for every song!
Rumor has it PRO’s are now turning to monitoring advertisements in local cities for cover bands, karaoke nights and DJ’s. Why the sudden tough enforcement? The PRO’s aren’t bringing in the money they used to with music being constantly copied, streamed, downloaded and outright stolen.
Many people think because they purchased a song on CD or through iTunes they own it and can use it as they wish. Wrong. What you actually purchase is not the song but a license to use that copy of the song for your own personal use. It can not be used for public purposes.
Everyone should be compensated for their work. Venue owners should be knowledgeable and play by the rules, however the rules need to be fair and applied in a way that promotes music and not scares people away from the music.
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