Background Music Strategy
10 Minute Read
The Ultimate Guide to Music Licensing for Your Business
by Ryan Santangelo, Ph.D., Co-Founder & CEO, Dynamic Media
You know playing music in your business is smart. But did you know that you can’t use your personal subscription to the mainstream streaming services in your establishment? Copyright law requires you to play licensed music for your business.
This article will examine commercial music licensing and the requirements for playing music in a business. We’ll also look at the penalties for not having a music license for your business to help you understand the importance of ensuring everything is above board.
What Is Commercial Music Licensing?
Commercial music licensing involves obtaining permission from copyright owners to use their music in your business. This includes the use of music in public spaces, such as:
- Restaurants
- Spas
- Cafes
- Bars
- Retail stores
- Many other locations
Commercial music licensing is essential because it ensures that music copyright owners are fairly compensated for the use of their creative work. It also protects businesses from the potential legal consequences of copyright infringement.
Who Is Responsible for Issuing Music Licenses for Businesses?
Performing rights organizations (PROs) are responsible for issuing music licenses for businesses. PROs create agreements with songwriters, composers and music publishers to license their music for use in public places. They then provide general or “blanket” licenses to businesses wishing to play the songs of the artists they represent.
Several PROs issue licenses in the United States, including:
- ASCAP — covering over 17 million songs
- BMI — more than 20.6 million compositions
- SESAC — over 1 million songs
- GMR — more than 80,000 songs
Securing all the appropriate licenses can be complicated because the writer of a song may work with one PRO while the composer of the same piece belongs to another PRO. You need licenses from both organizations to legally play that song.
PROs regularly send representatives to large and small businesses to ensure they have the appropriate licenses for the music they play.
Do I Need a Music License for My Business?
Whether or not you need a music license for your business depends on how you plan to use music in your establishment. Playing music in a business open to the public generally requires commercial music licensing.
Some business owners may think they only need live music licensing, but licenses are required whether you play CDs, MP3s, radio or television.
What Are ASCAP and BMI Music License Exemptions?
There are a few ASCAP and BMI music license exemptions if you only play music on the radio or television, including incidental music in commercials and TV shows.
If you run a food service or drinking establishment and want to qualify for an exemption, you can’t charge admission (including cover charges, admission fees and minimum order requirements). Your business also must be less than 3,750 square feet (including outdoor space used seasonally to serve customers).
If your establishment is more than 3,750 square feet, you might qualify for an exemption if:
- You play the radio with six or fewer speakers and no more than four speakers in one room.
- You use a television and have no more than four televisions, with only one per room. The TVs must measure less than 55 inches diagonally, and you must comply with the same speaker requirements as for radios.
If you run a business other than a food service or drinking establishment and want to qualify for an exemption, your facility must be less than 2,000 square feet, and you can’t charge a fee.
If your establishment exceeds 2,000 square feet, you might qualify for an exemption under the same conditions as food service and drinking businesses over 3,750 square feet.
These are only general descriptions of the requirements. It would be wise to contact the PROs or a knowledgeable attorney for specifics concerning your business.
Do I Need a Music License for My Business If I Only Play Unlicensed Music?
If you play only music in the public domain or hire local musicians who play only their own compositions, you may be able to get away without a music license for your business. But it’s time-consuming and challenging to identify music in the public domain, and it’s rare to find musicians who never play licensed songs.
Do I Need a Music License for My Business If I Pay Musicians or DJs to Play Music?
Because your establishment profits from the performance of music played by DJs and musicians, you still need a music license for your business. The same applies if you use CDs or MP3s to play music in your facility. Simply paying for the music doesn’t give you the necessary permissions to play the music in public.
What Happens If I Play Music Without Commercial Music Licensing?
PROs are very proactive in identifying businesses that don’t have the proper commercial music licensing. They carefully check music licenses for bars and other businesses. Depending on the circumstances, you could be liable for per-song fines ranging from $750 to $150,000 if you’re caught without a music license for your business.
What Are Other Alternatives to Commercial Music Licensing?
Securing the proper music licensing for a restaurant can seem daunting. But there is another option for playing music in a restaurant legally. Companies of all kinds can benefit from subscribing to a commercial music streaming service. These operations provide a wide range of music with the appropriate commercial music licensing. You can concentrate on running your business and play music without worrying about the PROs trying to fine you.
Leading music streaming services for business include:
- SiriusXM Music for Business, offering over 45 million songs
- Soundtrack Your Brand, with 65 million songs
- Mood Media, providing between 1 million and 2 million songs
- Pandora for Business, offering 3 million songs
- Cloud Cover Music, with 1 million to 2 million songs
SiriusXM Music for Business offers the best of all possible worlds. With an affordable monthly subscription rate of $26.95, it has more than 240 channels, over 100 Xtra Channels and 10,000-plus Pandora Artist Stations.
Get Licensed Music for Your Business — Subscribe to SiriusXM Music for Business Today
Playing licensed music for your business has never been easier. For one low monthly rate, you get a fantastic range of music with SiriusXM Music for Business. And all of it is free from commercials and DJ interruptions. You can stream your music from a wide array of compatible devices, including a satellite radio, dedicated players, mobile devices, your computer and more. Contact us today to find out everything SiriusXM Music for Business can do for you.
