Do I Need a License to Play Music in my Business?

ipod keyboardIn the digital era that we live in, where music can be exchanged so easily via streaming services and online purchases, it can be tough to understand what rights one has to use the music that is in their possession. If you buy an album, for instance, does that grant you the right to use that music in your business establishment?

The short answer is no, not without the proper licensing. For the longer answer and the reasons why this is, read on.

Why Do I Need a License to Play Music That I Own or is Available to Me for Free?

Some business owners think that they can utilize their private streaming services like Pandora Radio and Spotify within their businesses. Similarly, they might believe that they can use music that they have purchased in the form of CDs or digital downloads because they’ve literally paid to obtain this music.

Be advised that paid music and streaming services only apply to private use. This does not cover the commercial application of music, which requires a public performing license (or PPL) from any or all of the three performance rights organizations (or PROs).

What are PROs and How Do They Enter the Equation?

Performance rights organizations represent the creators and distributors of music and ensure that their music is used within what the law allows. As it stands, using music without the proper licensing is in violation of copyright law and can incur some hefty fees. To avoid these legal fees, businesses acquire licenses from PROs to use their catalogs.

The three PROs that US businesses must be concerned with are BMI, ASCAP and SESAC. Each PRO offers its own selection of music, as each represents different artists and musical distributors. Businesses can pay any or all three of these organizations for the rights to use their music catalogs in their establishments.

It is worth noting that just because you have acquired the adequate licensing to use BMI’s catalog, for instance, this does not mean that you are entitled to use music represented by ASCAP or SESAC. Business owners that want the most inclusive offering of music for their businesses will often acquire a license for all three.

Are There Any Exemptions?

There are few exceptions to this rule that apply to a specific set of businesses: particularly, any establishments with less than 3,750 gross square feet in which they serve customers. This is most commonly applied to restaurants and drinking establishments. Additionally, this rule only applies to television and radio, and only under specific circumstances.

If your business has any of these qualities, it is not exempt from the need for licensing:

  • 4 or more televisions
  • More than 1 television in any one room
  • 7 or more loudspeakers
  • 5 or more loudspeakers in any one room

If the establishment charges its customers to listen to the radio or television, they must pay for that music.

Generally speaking, it is advisable to go through the proper channels and obtain licensing from the PROs that are mentioned in detail above, you can also visit Cloud Cover for more information. This way, businesses avoid the hefty costs of violating copyright law while opening up their options to a wide catalog of music selections.

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