Music licensing is a complex topic that many business owners are often intimidated by. Well, not anymore! This guide will look at the basics of music licensing for businesses of all types & sizes, including what rights are included in a standard license, royalty tracking, and much more. We’ll also touch on the benefits of including music in your marketing strategy and some great opportunities to do so.
The music industry is a multi-billion dollar business with a wide range of licensing options. From traditional licenses to digital streaming, the music industry allows businesses to play their favorite songs legally. When you think about it, music in business is quite simple: play a song at work, and you’re likely to make your employees happier. But even though it seems like common sense, many companies don’t understand how music licensing works or what they need to play music legally.
If you’ve been interested in streaming background music at your place of business to create better, more engaging experiences, but need to know where to start, read on!
What is ASCAP, BMI, and SESAC?
ASCAP (American Society of Composers, Authors, and Publishers) is one of three U.S.-based performing rights organizations (PROs). PROs collect royalties on behalf of songwriters, composers, and publishers when their compositions are performed publicly — on live radio broadcasts or through live concerts, for example — and then distribute those royalties back to the creators of the work. BMI (Broadcast Music Inc.) and SESAC (Society of European Stage Authors and Composers) are the other PRO organizations in the United States.
What do ASCAP, BMI, and SESAC do?
ASCAP (the American Society of Composers, Authors, and Publishers) is a non-profit organization representing songwriters and publishers across the globe. Their mission is to protect their members’ copyrights while promoting the rights of creators and publishers in all genres of music.
BMI (Broadcast Music Inc.) is another non-profit organization that protects the rights of composers, songwriters, and music publishers by collecting license fees on behalf of its members’ musical works and distributing them as royalties when those works are used publicly. BMI represents musical works from creators worldwide.
SESAC has a variety of different licenses available depending on your business needs. For example, if you have a radio station that plays music regularly, you will need a Radio Play License. This license allows you to play all types of music, including pop, rock, country, and hip-hop, without paying royalties for each song. There are also other types of licenses available such as Digital Use Licenses which allow businesses to use digital copies of songs they own on their website or social media pages, as well as Mobile Phone Use Licenses which allow businesses with smartphones or tablets to stream music from apps like Pandora or Spotify while at work.
What constitutes a public performance of music?
The simplest way to answer this question is by giving an example: If you’re playing music on your stereo in your store or office, that’s considered a public performance of copyrighted material and needs licensing. But if you have an employee who plays music from their phone onto headphones, this isn’t considered a public performance because it doesn’t affect anyone else who isn’t there to listen in on it.
Don’t I already pay to license that material when I buy the CD, subscribe to a streaming service, pay the band, or hire a DJ?
The short answer is no! If you buy CDs or subscribe to a streaming service (such as Pandora or Spotify), you are paying for an individual license that allows you to play that music in your home and on your computer. Those licenses do not allow you to play those songs in your store where other people can hear them outside your home or on their phones while they wait in line at Starbucks. You will need an additional license from Sound Exchange Inc., representing the recording industry worldwide and distributing royalties directly to artists and labels through its PRO partner network of ASCAP, BMI, and SESAC.
What about playing radio or television broadcasts?
For many businesses, playing music is essential to the customer experience. But if you don’t have the right licensing, you could face fines and even legal action from music copyright holders.
Music is playing from the moment you wake up until the second you head to bed. It’s on the radio, it’s on TV, it’s in restaurants and malls, and it’s even in many businesses.
Most people don’t know that this music has a price tag attached to it — and if you’re using it without paying for it, you could be breaking the law.
The good news is that laws allow businesses to legally use music from other sources outside of streaming services like Spotify or Apple Music. The bad news? If you don’t know how those laws work or what they mean for your business, then you could be putting yourself at risk of breaking copyright laws — which can have serious consequences if you’re caught by the right people!
The answer is yes you need licensing — if you are playing them loudly enough for people outside your building to hear them inside your building, then you need permission from the copyright owner(s).
Can I play any music without violating copyright laws?
There are a lot of factors to consider when you’re licensing music for your business. Here are some of the most important things to keep in mind:
You can play any music without violating copyright laws if you own the original recording (CD, vinyl record, etc.) or have written permission from the artist or label. If you don’t have that permission or own the recording, you’ll need to license it separately.
Most businesses use a blanket license issued by a performing rights organization (PRO) — like ASCAP or BMI — which allows them to play any music in their businesses without paying royalties on each song they play. For example, if you’re playing music at your coffee shop, you don’t have to pay royalties for each song; instead, you pay a flat rate for a blanket license for all songs played in your business.
Music Licensing for Businesses with Soundtrack
Music in public spaces can boost sales and drive in solid foot traffic, and the background music streaming at your business can be licensed and paid for through several factors. Stay up on the latest developments by reading articles like this, learning what you can and cannot do, and consider reaching out to a company like Soundtrack Your Brand to best help your business along the way when it comes to licensing music for your business from the world’s largest catalog of songs, playlists, and artists.
