Background Music Strategy
20 Minute Read
How To Get A Music License for A Restaurant
by Ryan Santangelo, Ph.D., Co-Founder & CEO, Dynamic Media
If you’re a restaurant owner, you know that playing music is a great way to create a relaxed and fun atmosphere for your customers. But what you may not know is that in order to legally play music in your restaurant, you need to have a music license.
For business owners looking to play background or foreground music in restaurants, it is essential to understand the licensing requirements to avoid legal hassles. Obtaining a music license for restaurants can be confusing for business owners, but professional services like SiriusXM Business include all the permissions you need to make playing music in a restaurant easy and legal.
So, what is a music license for restaurants anyway? Various types of licenses and regulations govern how and when owners can play music in a restaurant. Thankfully, SiriusXM for Business is here to give you the ins and outs of obtaining a license to legally play music in restaurants. Keep reading to learn more.
Restaurant owners are at significant legal risk for violating copyright laws by playing music in restaurants without a license.
Using a personal music subscription like Spotify in your restaurant to sell more food or drinks is like using your personal Netflix subscription to open a movie theater.
It’s easy to obtain a license to legally play music in restaurants and avoid performing rights organizations such as ASCAP, BMI, SESAC, and Global Music Rights.
What Is a Music License for Restaurants?
In simple terms, a restaurant music license is a legal agreement between the restaurant and a music licensing organization, such as BMI, ASCAP, SESAC, and GMR. These licenses give business owners legal permission to play music in restaurants.
There are several reasons why restaurant owners need this license to legally play music for their customers.
- First, playing copyrighted music without permission can result in legal penalties and fines, which can be very costly for restaurant owners.
- Second, by acquiring this license and paying royalties on each song played, restaurant owners demonstrate that they respect artists’ intellectual property rights and support their work as creators.
- Third, obtaining this license helps restaurant owners maintain high standards of quality in their establishments by ensuring that the music played is appropriate and contributes positively to customers’ dining experiences.
Having the right restaurant music licenses is not just the right thing to do — they are essential for restaurant owners who desire to create an enjoyable dining experience for their customers while also protecting their interests.
Does Spotify or Apple Music Offer a Restaurant Music License?
These platforms do not have public performance licensing agreements in place with record labels. As a result, playing any consumer streaming service in a restaurant, even for a minute, would be considered an infringement of copyright law.
Using a personal music subscription like Spotify in your restaurant to sell more food or drinks is like using your personal Netflix subscription to open a movie theater. Such use is a clear violation of copyright law and puts your restaurant at significant legal risk.
Tip: Restaurants that play music strategically as part of their restaurant atmosphere should explore legal options, such as SiriusXM Music for Business, that do have public performance licenses.
Is a Restaurant Music License a Tax On My Business?
No, not at all. The license fee for restaurant music is not an unfair tax but rather a way to support artists pursuing their craft. The revenue from these fees goes towards helping them earn a living while they pursue their craft, which includes making more music that you can continue to use to engage with your guests.
What Are Performing Rights Organizations & What Do They Do?
There are four main music performing rights organizations in the United States: ASCAP, BMI, SESAC, and Global Music Rights. Each organization has its own criteria for membership, but all provide similar services.
They work to ensure that songwriters and composers are fairly compensated when their work is performed publicly. This includes collecting royalties from businesses like restaurants, along with radio stations, TV networks, and live venues. The organizations then distribute the royalties to their members according to a set schedule.
In addition to fighting for the rights of songwriters and composers, performing rights organizations promote the use of music in all aspects of life. They believe that music has the power to connect people and bring joy to everyday moments. As a result, they work tirelessly to ensure that music remains an integral part of our culture.
What Happens If You Don’t Pay for a Restaurant Music License?
If you don’t pay for a restaurant music license, you could be subject to fines. The fines can vary depending on the restaurant’s location and state, but they can be as high as $150,000. In some cases, fines can be even higher if the restaurant is found to be playing music without a license on multiple occasions.
Not paying for a license to play music in your restaurant puts your business at risk for potentially catastrophic outcomes. Restaurants that play music without the proper coverage open themselves up to the possibility of being sued in federal court. PROs routinely send undercover investigators who pose as customers to restaurants that play music throughout the U.S. to check compliance with their regulations. Suppose any PRO finds that you’re playing copyrighted music without a restaurant music license. In that case, they will rightfully use the legal system to force compliance in addition to demanding payment for the term you were using unlicensed music.
Fast Fact: In June 2016, BMI music took action against a small New Jersey restaurant for playing 17 copyrighted songs without a restaurant music license. The restaurant was legally responsible for paying the $56,100 in damages and associated legal fees.
In addition to fines, the restaurant may also be required to cease playing music altogether until a valid license is obtained. Consequently, it’s essential to make sure that you are compliant with the law and have procured the necessary licenses before you play music in your restaurant. Doing so will help you avoid costly fines and ensure that you can continue providing your guests with an enjoyable dining experience.
Look to SiriusXM Business for Restaurant Music Services
In the long term, playing music in a restaurant legally is far less expensive than paying the penalties for not having a restaurant music license. Fortunately, accessible and economical solutions for restaurant music licenses are available to owners. SiriusXM Business makes playing music in a restaurant legally the easiest it’s ever been.
Important: For as little as $26.95 a month, you’ll have complete access to hundreds of professionally curated music streaming channels, all of which are fully licensed and legal to play. Don’t subject yourself to hefty fines by ignoring music licensing laws – choose an easier option with SiriusXM Music for Business.
How Much Is a Music License for a Restaurant?
Public performance licenses are required for a restaurant to play music in their establishment. These restaurant music licenses come at a cost to the restaurants. A standard license, when adding up all four PROs, will cost between $400 to $2,000 per year, while larger establishments that feature live performances will need additional licensing that costs significantly more.
Despite these costs, most restaurants find it worthwhile to have music playing in their dining areas, as it helps to create a positive atmosphere for customers and encourages them to stay longer. Ultimately, a license to play music in a restaurant is an important investment for any restaurant looking to enhance the customer experience.
How to Pay for a Restaurant Music License
If you’ve decided to make the responsible choice and pay for a restaurant music license, you have two main options to avoid breaking copyright law:
- Pay the PROs Directly: You can pay ASCAP, BMI, SESAC, or GMR directly to get a license to play music legally in a restaurant. This is an option, but it has some problems. The biggest issue is that you will only be able to play music from artists that the PRO represents. So, if you only pay for an ASCAP license, you’ll only have access to the 735,000 artists they represent, but you won’t be licensed to play the millions of songs represented by the other PROs.Since there is no easy way to tell which songs belong to which PROS, the only way to avoid licensing risk entirely is to pay each of the PROs, which will give you access to all the music in the world. Not only is this extremely expensive, but it forces you to sign four contracts, report to four organizations, and several other administrative burdens that take the focus off your restaurant operations.
Wouldn’t it be nice if you could pay a small monthly fee and have all of the licensing handled for you? With SiriusXM Music for Business, you can.
- Subscribe to a Restaurant Music Service: Licensed background music platforms, like SiriusXM Music for Business, have agreements with all four PRO licensing organizations. SiriusXM Business not only gives you a massive catalog of music and curated channels to play as music in restaurants, but they include all the licensing fees as part of the monthly payment. These fees are collected and paid to the PROs on your behalf, who then pay the artists for their music. This means that you don’t have to deal with any of the PROs directly, removing the licensing hassle completely. You simply pay a flat monthly fee to SiriusXM Business, and you’re covered to use any of the 240+ channels and 10,000 Pandora Artist Stations as often as you want.
These topics will help get you started in protecting your restaurant from costly legal fees and negative publicity. If you’re ready to get started, check out these resources from SiriusXM music for business:
SiriusXM Business Is the Easiest Way to Play Music in Restaurants Legally
Leave paying out hundreds or thousands of dollars to PROs in the past with a SiriusXM Business subscription. Our restaurant music service gives you access to hundreds of unique channels and thousands of artists for a fraction of the price. Not only that, but you’ll be able to keep your customers happy and your restaurant thriving. Check out our deals today – we offer satellite and streaming services with SiriusXM and Pandora Artist Stations, so business owners can play music in restaurants whenever they please. If you have any questions, feel free to call us at 844-229-1217 to learn how you can sign up today.