[Music Licensing] Music Licensing for Business

Music Licensing
for Business: Simplified

Need-to-know information to ensure the music in your business never skips a beat
Introduction
Music licensing is one of the most confusing topics for small business owners and a topic
we get questions on all the time. You’re passionate about your products, your services,
your customers and your business, and want to create the best guest experience possible.
Frequently, music is a key element in creating this environment. But how are you supposed
to know what licensing is required, or if it’s even different than consumer licensing?
This guide provides an overview to navigating the music licensing waters and tips to help
ensure you’re in compliance.
Music Licensing for Business: Simplified
Unfortunately, licensing music for business isn’t as simple as buying a CD or

downloading a digital copy from iTunes or Amazon. There are defined rules that
U.S. copyright law and licensing organizations have established to ensure proper
compensation is delivered to rights holders and labels, and it’s your responsibility as
the business owner to ensure you’re in compliance. You wouldn’t steal the artwork
displayed on your store’s walls, and music is no different!
What There are three main types of music rights ownership in the
United States:
licensing Master Use License – grants the ability to use a specific
is 1} master recording embodying a specific artist’s performance

of the composition.
required
2}
Mechanical License – permits the licensee to manufacture,
reproduce, and distribute the musical composition in
to play audio-only formats.
music in a The most known rights ownership related to commercial use,
business? 3} Public Performance. Public Performance rights cover the

performance or transmission of a copyrighted work where
there are a substantial amount of people present.
Did you know?
Any public transmission or performance of a protected work must be licensed from the
associated rights holder under all three scenarios.
Why is Public Performance rights are protected in

Title 17 of the United States Copyright Law, which lays
licensing out the ownership, scenarios, and responsibilities for the

licensing of music.
music for In the copyright law, “public” is defined as “a place
business
open to the public or at any place where a substantial
number of persons outside of a normal circle of a family
and its social acquaintances is gathered.” Businesses
different than fall into this category and hence, Public Performance
licenses are required in additional to Master Use and
for consumer Mechanical licenses.
use?
Did you know?
When you purchase a CD, download a song from iTunes, or stream music from the
internet via Pandora or Spotify, you are only paying for the rights to personal use.
These rights for these sound recordings do not carry over to commercial settings.
What The copyright law can be applicable to all types of

commercial establishments — some that you may not think
types of of immediately — including:
businesses »» Bars and Taverns

»» Restaurants
do these »» Inns
rules »» Nightclubs
apply to?
»» Fitness and Health Clubs
»» Retail Stores
»» Banks and Financial Institutions
»» Doctor and Dentist Offices
»» Hotels
»» Supermarkets and Grocery Stores
»» Auto and Boat Dealerships
»» Shopping Malls
»» Schools
»» And More
where In the U.S., composers, lyricists, artists, and publishers are

typically part of a Performing Rights Organization (PRO).
does my These groups control the ability to publicly perform and

play the works of their members, and they collect and
money go? distribute fees for the licenses granted accordingly.
In the U.S. the main PROs are the American Society

of Composers, Authors and Publishers (ASCAP),
Broadcast Music, Inc. (BMI), and SESAC.
who receives Rest assured, your license fees go to the correct place –
the composers, lyricists, performers, and publishers!
compensation? Each of the PROs distributes the collected fees to the

these parties per the agreements established between
the two entities.
If you like music, support those involved through

proper licensing so they can keep producing
exceptional creative works!
Responsibility
Your obligations as a business owner are vast. Inventory,

rent, salaries, taxes – all of these costs are the
responsibility of the business. Music is no exception!
Who is The owner of an establishment in which copyrighted

music is performed is responsible for ensuring that the
responsible proper licenses are being obtained for each song played
on the premises.
for the This means business owners are also liable for any
license?
infringement of copyrighted music.
In some cases you may be exempt from licensing, such as

if your business has very small square footage and you play
broadcast radio, however most instances require proper
licensing for the music that is played in the business.
What happens Bypassing appropriate music licensing can be far

costlier than paying upfront.
if I don’t Failure to obtain the proper licenses is copyright
have proper infringement under the current laws in place. If you

are found in violation of copyright law, you can be
licensing?
fined for damages as well as for the copyright owner’s
legal fees. The amounts of these statutory damages
can easily range from $750 to $150,000 per song if
the court finds the infringement was willful.
And remember, since different PROs represent

different songs and their copyrights, you need licenses
from each PRO that represents every song you play!
Instances of copyright infringement are La Huerta Mexican Restaurant

well documented and have frequently Ordered to Pay More than $37,000
been reported on in the media. Each Read More >>
of the PROs acts swiftly to ensure that
their members are being compensated
Fosters
accurately, and that businesses are taking
Found liable for $41,150 in
the time to ensure their music is legal.
Copyright Infringement
Here are a few examples of establishments Read More >>
that have failed to get the proper music
licensing and the ramifications that Fody’s Great American Tavern
resulted. Fined $150,000
Read More >>
What can I Thankfully, there are affordable ways to get premium

quality music and other programming for your
do to ensure business while relieving yourself of the administrative

burden and stress that comes with music licensing.
that my music PlayNetwork is a global leader in commercial
is properly
music programming and licensing. We support big
companies like Starbucks (for whom we’ve been
licensed?
handling music and licensing over the last 17 years),
Gap, and Hilton Hotels, as well as tens of thousands
of local and one location businesses and franchises.
We take our label,artist,publisher, and PRO

relationships very seriously and invest significant
time to prevent potential problems for our clients.
We connect regularly with these parties to mantain
open communication and ensure all requirements are
being met and payments being made.
PlayNetwork has a wide range of music service levels,

allowing you to choose one that’s tailored for your
business needs. From custom, curated music strategies
that extend your brand identity to channel-based,
commercial-free programming, we have options that will
fit with your objectives and budget.
PlayNetwork’s music services:
»» Cover Master Use, Mechanical, and Public

Performance licenses in the U.S. and Canada. We
also have established structures to license content
in over 90 countries – each country has it’s own laws
and regulations – giving you the opportunity to
grow your business worldwide and take your music
with you.
»» Eliminate the business risks and management
burden of commercial music licensing and rights
procurement from your business. Our Global
Licensing team handles all license management,
reporting, and royalty payments on your behalf.
»» Ensure you have a diverse set of music
programming from multiple genres that’s kept
fresh. We work with more than 4,000 labels, artists,
publishers, and PROs worldwide, and ingest more
than 1,000 new songs into our database every week.
GET STARTED TODAY

Visit our site to learn more about PlayNetwork. Fill out the contact form to sign-up!
http://www.playnetwork.com
© 2013 PlayNetwork, Inc. This document is for informational purposes only. Information
contained herein is not intended to be legal advice and should not be considered as a
substitute for legal counsel should you have a copyright question or issue.

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Music Licensing

for Business: Simplified

Unfortunately, licensing music for business isn’t as simple as buying a CD or

licensing Master Use License – grants the ability to use a specific

is 1} master recording embodying a specific artist’s performance

music in a The most known rights ownership related to commercial use,

business? 3} Public Performance. Public Performance rights cover the

Did you know?

Why is Public Performance rights are protected in

licensing out the ownership, scenarios, and responsibilities for the

music for In the copyright law, “public” is defined as “a place

What The copyright law can be applicable to all types of

types of of immediately — including:

businesses »» Bars and Taverns

where In the U.S., composers, lyricists, artists, and publishers are

does my These groups control the ability to publicly perform and

money go? distribute fees for the licenses granted accordingly.

In the U.S. the main PROs are the American Society

compensation? Each of the PROs distributes the collected fees to the

If you like music, support those involved through

Your obligations as a business owner are vast. Inventory,

Who is The owner of an establishment in which copyrighted

In some cases you may be exempt from licensing, such as

What happens Bypassing appropriate music licensing can be far

if I don’t Failure to obtain the proper licenses is copyright

have proper infringement under the current laws in place. If you

And remember, since different PROs represent

Instances of copyright infringement are La Huerta Mexican Restaurant

What can I Thankfully, there are affordable ways to get premium

do to ensure business while relieving yourself of the administrative

that my music PlayNetwork is a global leader in commercial

We take our label,artist,publisher, and PRO

PlayNetwork has a wide range of music service levels,

PlayNetwork’s music services:

»» Cover Master Use, Mechanical, and Public

GET STARTED TODAY

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