United States Copyright Law was established to protect the rights of artists, authors, composers, and publishers for their musical works. Everyone who performs or distributes music in a public space must own the rights to that music. A violation of the federal copyright laws of the United States would result in severe legal and financial penalties. Copyright law protects musical works just like it protects authors and filmmakers. Therefore, it’s illegal to play music in public places if you don’t have a license for the music. It’s surprising to see how many business owners don’t know about this regulation. They don’t know that they need to obtain a license to play music or don’t know how to play music in their business legally.
What is a PRO?
Performing rights organizations (PROs), also known as performing rights societies, collect royalties on behalf of songwriters and publishers, creating a link between owners of composition rights and music users (from radio stations to streaming services to your local business broadcasting music).
As a technical matter, PROs are just a subset of a broader landscape of collective management organizations (or CMOs), which handle royalties due to public broadcasters of music works.
What is ASCAP? Why should I know about them if I want to stream music in my business?
ASCAP is a short form for the American Society of Composers, Authors, and Publishers. It is a not-for-profit membership organization representing more than 850,000 songwriters, composers, lyricists, and music publishers. They are the only performing rights organization that was formed and is run entirely by its members. ASCAP catalog has more than 16 million musical works. Their members receive royalties ensuring that their hard work is compensated.
In 2021 alone, $1,254 billion in royalties made available for their 850,000 members.
How do ASCAP fees work?
ASCAP offers over 100 different types of licenses depending on the business’s needs. As a business owner, you can look at their offerings to see what the fees might look like for your business. To use any song in ASCAP’s catalog in your business, you must purchase an annual license.
How much does ASCAP licensing cost?
The cost varies depending on the business type or size and the intended use of the ASCAP license. They charge an annual fee for access to their library. Some of the variables for the licensing costs are:
- the type of business
- whether the musical work is performed live or recorded
- the size of the potential audience at the venue
The minimum ASCAP licensing fees are $390 per year, so you will never pay less than that to access their catalog.
What is included in an ASCAP license?
A license from ASCAP gives a user access to the PRO’s repertoire, which includes millions of songs by famous and brand-new artists over many decades. ASCAP offers different licenses for various types of performances, including cover songs, recorded music played in public, ads, feature films, etc.
With an annual contract with ASCAP, you are only receiving the rights to use the music in your venue; you are not getting a subscription to a music streaming service.
Do I always have to pay the license fee to ASCAP?
According to ASCAP, you do not have to license the music when you play music for a small area through the radio or television in your establishment “if the performance is by means of public communication of TV or radio transmissions ” says ASCAP.
However, you will need to contact a PRO like ASCAP for larger sound systems. Businesses with more than 3,750 gross square feet of space must purchase licenses to access ASCAP’s catalog. There are around 150 licensing representatives who work for ASCAP across the U.S. They inspect venues to ensure no violations of in-store copyright exist.
How much is the fine if I didn’t pay for the ASCAP license?
Violations of the ASCAP copyrights can have a significant financial impact. According to reports, you can expect to pay anywhere from $750 to $30,000 for each violation.
Buying an ASCAP license isn’t the only option out there
Even though ASCAP is the leading standard for PROs, and the company is transparent about its pricing structure, it may not be the best match for your business.
You may find that ASCAP has some of the songs you are looking for in their library. However, with many recording artists spreading their music over several PRO libraries, you will most likely need to purchase licenses from several PROs rather than just ASCAP. Additionally, obtaining these licenses from the PROs does not provide you with a music streaming service. You will still need to subscribe to a music service provider that can offer you ad-free and quality music.
As you can see, the costs of streaming music quickly add up, so you may want to consider alternatives to this type of service.
ASCAP or BMI? Do I need both ASCAP and BMI?
You probably will need both ASCAP and BMI licenses to play a variety of artists and songs in your establishment. As mentioned above, there are four PROs in the United States representing musical works of different songwriters, composers, and publishers. A song you stream at your businesses may be in BMI’s catalog and not ASCAP.
For example, if you played a song licensed through ASCAP and another song licensed through BMI, you would have to pay both ASCAP and BMI licensing fees. So should I buy a license from both?
Let’s give you another example:
Suppose you like the musical band Old Dominion and want to have access to all their discography. In that case, you then need both BMI and ASCAP licenses. Why?
Break Up With Him song performed by Old Dominion is registered with ASCAP. On the other hand, their Bad At Love song is registered with ASCAP and BMI (74.99% is controlled by BMI and 25% by ASCAP). In this case, you do need to have licenses from both ASCAP and BMI.
Suppose you do not want to negotiate a contract and pay licensing fees to a PRO like ASCAP or BMI. In that case, you can search for other types of songs, such as royalty-free songs, Creative Commons music, or public domain music.
However, these options have no trendy or famous songs, which may not be the best option for storefront music or background music for business settings. Finding the fitting soundtracks for business use may also be time-consuming and frustrating with these solutions.
Great Alternative for Streaming Business Music: Jukeboxy
As an alternative to paying licensing fees to the PROs and spending time to find fitting music for your business, you can subscribe to commercial music streaming services, such as Jukeboxy Music for Business.
With more than 45 million songs in its library, Jukeboxy Music has one of the largest music libraries in the industry. Their database provides your business with the best variety of music from ASCAP, BMI, SESAC, and GMR libraries. All at a much lower price than buying licensed music from PROs.