Incorporating music into your business model usually requires payment of a music licensing fee. One company offered onsite children’s’ activities with music in the background. The business owner legally downloaded the music from an online digital music store and played it on a modest stereo set-up.
Not surprisingly, one of the performing rights organizations (PROs) came knocking at the business owner’s door claiming that the company’s use of the music required a license. Public performances of songs do require licenses and the payment of royalties. Since many people do not realize the necessity of a license for the public performance of music, the initial step of PRO’s upon finding an unlicensed use is “to educate”. However, if the company does not comply, the PRO will move to legal action which can result in damages of a few thousand dollars for each song the PRO can document the business played without a license.
The PROs in the United States are ASCAP, BMI, and SESAC. Each PRO has a different catalog of songs. BMI is the largest. SESAC is the smallest of the three with the smallest catalog. If one approached the company mentioned above, the other two may very well be in touch soon.
While public performances of songs require licenses, private performances do not. However, there have been many disagreements concerning what constitutes a public performance versus what constitutes a private performance. For example, a performance may be deemed as public even if it takes place in a semi-public place such as a social club.
I discuss the topics of music licensing, PRO’s and public versus private performances in depth in my book The Permission Seeker’s Guide Through the Legal Jungle: Clearing Copyrights, Trademarks and Other Rights for Entertainment and Media Productions (available at www.GuideThroughtheLegalJungle.com and from retail and online bookstores).