Music Licensing is not rocket science. But it's not intuitive either. This infographic illustrates some of the broader principles for music licensing under United States law.
The downloadable pdf can be printed onto one sheet of legal-sized paper. Download Music Licensing Infographic - by Joy Butler Esq.
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The Copyright Clearance Center’s (CCC) Velocity of Content blog is offering three articles adapted from my recent CCC-sponsored webinar presentation about uses of music within the work and office environment:
Music Licensing: The Difference Between Public Performance and Synchronization Licenses The complexity of music licensing stems in part from the different types and names of music licenses. The music industry gives different names to music licenses according to whether you are using the song or the sound recording and according to how you are using the music. During the webinar, I reviewed different categories of music licenses and gave examples of when you might need each one – including public performance licenses which grant permission to perform music in public and synchronization (or synch) licenses which grant permission for the use of a song in a video, advertisement, or other audio-visual presentation. Read the article, “Music Licensing: The Difference Between Public Performance and Synchronization Licenses” on CCC’s Velocity of Content blog.
Using Music at Work – 5 Source and Licensing Considerations During the webinar, I discussed the pros and cons of the following sources where a company might seek music for its video, advertisement, and training materials:
Music Licensing: What is Considered Fair Use? Copyright fair use is an exception to copyright protection that allows you to use a small portion of a copyrighted work without the copyright owner’s permission. The challenge for those who want to rely on fair use if that the doctrine is subjective, has no bright line rules, and must be decided on a case-by-case basis according to the specific circumstances. During the webinar, I discussed how the fair use doctrine applies to educational use, incidental use (i.e., a documentary production picking up music in the background during a shoot), and use for news reporting purposes. Read the article, “Music Licensing: What Is Considered Fair Use?” on CCC’s Velocity of Content blog.
Additional “Using Music at Work” Webinar Summaries and Recaps
Here is my recap of 25 key music licensing points I shared during the webinar, 25 Key Points about Using Music in Your Business. For more details and examples of these key points, you can listen to a recording of the entire 1-hour “Using Music at Work” webinar at http://go.copyright.com/l/37852/2017-02-24/cg7t1z
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Companies use music for the instant vitality, emotion, and specific mood that music can inject into a promotion, presentation, or a room. Companies are often uncertain about how they may legally use music, which uses require a license, and the best sources of music for business use.
I addressed these issues at a recent webinar, “Using Music at Work”, sponsored by the Copyright Clearance Center. Here are 25 key points I shared about using music in your business:
SOME BASICS
1. Common business uses of music that might require a license include
2. Music licensing can be complicated. Here is an easy-to-grasp general take-away. If your company is sharing music externally (on the internet – in an advertisement – at a conference), the company’s use of that music likely requires a license. Even if the company is sharing the music only within the organization, the use of that music might still require a license.
3. While music licensing is not rocket science, it is also not intuitive. As an initial step in determining which music licenses you need, you must understand that a song differs from a sound recording; and that each has its own separate copyright.
4. Typically – but not always – the song and the sound recording have different owners. The song copyright is owned by the songwriter or by the songwriter's music publishing company. The sound recording copyright is owned by the record label that released the recording. The same song can have multiple sound recordings with different ownership of each sound recording.
MUSIC LICENSES MOST COMMONLY SOUGHT FOR BUSINESS USE
(Public Performance, Synch, and Master Use Licenses)
5. Public performances of songs almost always require a public performance license. License requirements for the public performance of sound recordings are limited to public performances rendered over the internet or by other digital means.
6. If you play a song in a retail store, in a restaurant, at a conference, or other public venue, those are public performances (as opposed to private performances) of the song and a license is required. It does not matter whether the public performance is rendered by a live band, a CD, a DJ, or someone’s smartphone.
7. Most song public performance licenses are issued by performing rights organizations (PROs). The PROs for songs in the United States are ASCAP, BMI, and SESAC – which have been around since before the 1940s - and Global Music Rights, a relatively new PRO established in 2013.
8. Each PRO controls a different catalog of songs. Typically, the PRO issues blanket licenses that allow licensees to perform any song in the catalog of that PRO. Public performance licenses in songs are fairly easy to obtain. ASCAP, BMI, and SESAC offer websites where you can obtain and pay for the public performance license you need.
9. Using music in a video, advertisement, or any audio-visual presentation requires a synchronization (or synch) license from the copyright owner of the song and a master use license from the copyright owner of the sound recording.
10. There is not a specific name for every different manner in which a company might use music. For example, there is no specific name for incorporating music into your training materials. Licensing for training and business presentations is more similar to licensing for a video presentation since you need direct permission from the song and sound recording copyright owners
COMPARISON OF MUSIC SOURCES FOR AUDIO-VISUAL, TRAINING, AND BUSINESS PRESENTATION PURPOSES
(Popular Music, Production Music, Indie Music, Creative Commons Music)
11. As noted above, public performance licensing is relatively easy. In contrast, acquiring music to incorporate into company promotions, videos and presentations can be more difficult. When evaluating where and how to obtain music for this purpose, a company should consider ease-of-licensing, cost, suitability for the company needs; and potential risks.
Benefits and Advantages to Using Popular Music
12. Popular music (i.e., music by well-known artists, music listed on Billboard charts) is the most difficult to acquire. Its benefits include immediate recognizability and conveyance of the mood or period you wish to evoke.
13. Using popular music requires contacting and directly negotiating with the music publisher for a synch license in the song and with the record label for a master use license in the sound recording. These owners are likely major music industry companies and it is not uncommon for permission requests to a major music company to elicit no response.
14. License fees for popular music are frequently in the tens of thousands of dollars, depending on the popularity of the music and how it will be featured or used in the audio-visual production (e.g., background, foreground, over the credits).
Benefits and Advantages to Using Production Music
15. Production music companies are in business solely to license you content so they often make the acquisition process very easy by allowing you to preview, purchase a license, and download music online. The production company provides both the synch license and the master use license. The cost for some production music can be as low as $30. Most uses are usually less than $1,000.
16. Using production music carries minimal risk. Nevertheless, you should read the license agreement to be certain that your specific use is permissible. For example, some production music companies do not allow their music to be used in political advertisements.
17. As a downside, while production music can be very well-done music, it is not going to be music that was on the Billboard Top 100 and that people immediately recognize.
Benefits and Advantages to Using Indie Music
18. Music by independent musicians (i.e., musicians whose music is not distributed by a major record group and, as a result, might have narrower distribution and not be as well-known) is likely to be significantly less expensive than popular music and somewhat more expensive than production music. While it probably lacks the broad immediate recognition of music that was a Billboard Top 100 hit, it might be recognizable within a particular niche - depending on the indie musician’s fan base.
19. While a company will want all its music licensing agreements to include appropriate representations, warranties, and indemnifications, this is especially important when obtaining music from indie musicians. If indie musicians lack the funds and resources to document the ownership rights in original music on which they collaborate, ownership and rights questions can eventually result in a dispute among the indie musicians. And your company does not want to find itself in the middle of any such intra-band dispute.
Benefits and Advantages to Using Creative Commons Music
20. Creative Commons music is free to use, and easy to find and download on the internet. It is unlikely to be immediately recognizable music. Using any creative commons material is higher risk because it comes with no representations, warranties, or indemnifications.
Benefits and Advantages to Using Commissioned Music
21. You can commission original music. The expense depends on the commercial stature of the musician providing the music. It’s a longer acquisition process because you must negotiate the transaction and then wait for the composition of the songs and the creation of the sound recordings.
22. While the music is not immediately recognizable (because it is brand new music), it can be tailored to the company’s needs. If you have a well-drafted agreement for creation and acquisition of the original music, there should be minimal risk.
WHAT HAPPENS IF A COMPANY FAILS TO LICENSE MUSIC? AND WHAT ABOUT FAIR USE?
23. Using music in your business without obtaining the required license might result in a DMCA take-down notice for materials posted online. There is also the possibility of a cease and desist letter with or without a demand for a license fee payment for both online and offline use. In a worst case scenario, the legal consequences of infringing music will generate a copyright infringement lawsuit against the company.
24. Fair use is subjective – and just because you believe a use is a fair use doesn’t mean the rights owner will agree with you. The situations where fair use applies to music for company use are probably not as broad as some people believe. In my view, it is rare for a company’s use of music in an advertisement or promotion to qualify as a fair use. There might be situations or circumstances of using music in training materials that result in credible fair use arguments.
25. Like many legal issues, the answers to music licensing requirements and rights clearance questions are sometimes unclear. Sometimes, the right approach depends on your tolerance for risk. Here are questions to ask yourself when conducting a risk assessment over music use – or any other creative material.
For more details and examples of these key points, you can listen to a recording of the entire “Using Music at Work” webinar at http://go.copyright.com/l/37852/2017-02-24/cg7t1z
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One might think that using properly licensed material would guarantee insulation from a copyright infringement lawsuit. Apparently not. At least not for Kappa Map Group’s recent use of material per a Creative Commons license.
Background of Creative Commons License Dispute in Drauglis v. Kappa Map GroupKappa Map Group is a Pennsylvania-based publisher of maps and atlases. In July 2012, Kappa Map published an atlas entitled “Montgomery Co., Maryland Street Atlas”. The front cover of the atlas features a photograph of the Montgomery county landscape (presumably) entitled “Swain’s Lock”.
Kappa Map obtained the Swain’s Lock photograph from the online photo-sharing site, Flickr. The photographer, Art Drauglis, had uploaded the photograph to his Flickr account and selected the option of making the photograph available to others under the terms of a Creative Commons Attribution-Share Alike License.
What Is a Creative Commons License
Creative Commons is a non-profit organization offering free license documentation that copyright owners can implement to make their works available for use by others. When using material under a Creative Commons license, one need not pay a fee nor obtain direct permission from the licensor as long as one follows the terms of the license.
There are numerous forms of Creative Commons licenses. While all Creative Commons licenses do not permit commercial use, the Attribution-Share Alike license selected by Drauglis for the Swain’s Lock photo does.
Photographer Sues Kappa Map Group on Creative Commons Technicalities
As permitted by the Creative Commons Attribution Share-Alike license, Kappa Map used the Swain’s Lock photograph without notifying the photographer and without specifically asking him for permission. When the photographer learned that his photo adorned the front cover of the Montgomery Co., Maryland Street Atlas, he filed a copyright infringement lawsuit against Kappa Map.
The photographer did not dispute that he published the photograph under a Creative Commons license that authorized commercial use. Instead, he argued that Kappa Map’s use was beyond the scope of the license. Ultimately, the court concluded that Kappa Map’s use was indeed within the scope of the Creative Commons license and that the use was not infringing. In reaching that conclusion, the court rejected the following three technical arguments presented by the photographer:
Free Distribution of Atlas. The photographer argued that Kappa Map did not distribute the atlas for free as required by the license (the “ShareAlike Requirement”). The court found that the ShareAlike requirement applied only to derivative works of licensed material. According to the court, while the atlas included the photograph, the atlas was not a derivative work of the photograph. Therefore, the ShareAlike Requirement did not apply to the atlas and it was fine for Kappa Map to charge a monetary fee for the atlas.
Adequate License Information. The photographer argued that the Kappa Map atlas did not include adequate information about the Creative Commons license since Kappa Map did not print the url to the license on the atlas. The court disagreed determining that inclusion of a url was not mandatory and that Kappa Map satisfied the information requirement by including on the atlas back cover the notation - Creative Commoms [sic], CC-BY-SA-2.0 – which contained the license’s uniform resource name.
Proper Attribution for Photographer. The photographer argued that Kappa Map did not provide proper attribution for the photograph. The license requires that Kappa Map provide authorship credit in a manner comparable to and as prominent as credit provided on the atlas for materials comparable to the photograph. Credit for the photograph appeared on the back cover of the atlas in 7-8 point type as follows:
Photo: Swain’s Lock, Montgomery Co., MD
Photographer: Carly Lesser & Art Drauglis, Creative Commoms [sic], CC-BY-SA-2.0
The photographer argued that the material comparable to the Swain’s Lock photo was the entire 112-page atlas. Copyright notice for the entire 112-page atlas was on the first page of the atlas and was in at least 10 point type. The court found that the material comparable to the Swain’s Lock photo was not the entire 112-page atlas; but instead each individual map. The credit for each individual map was a bottom-of-the-page notation of “© Kappa Map Group, LLC”. The court concluded that the back cover credit given for the photograph was comparable to and as prominent as the individual map credit.
Lessons To Be Learned by Licensors and Licensees
Creative Commons Materials Are Not Risk-Free. While I view being sued by a Creative License licensor as a rarity, the other risks associated with Creative License materials are much more likely to emerge.
Read the Fine Print When Uploading Your Material to Websites and Social Media Networks. If you care about how the material is used, don’t just blindly accept the terms without understanding their impact – which is what the photographer of Swain’s Lock seems to have done when uploading the image to Flickr. Not all online postings provide the option or requirement of granting a Creative Commons license. However, as I discuss here and here, posting to social media sites such as Twitter and Facebook typically entails granting broad non-exclusive rights to the social media website to use your material (although users of the social media site don’t always have corresponding carte blanche to use your material).
Understanding and Complying with License Terms Is Important. While this is true of all licenses, perhaps it is more true for Creative Commons licenses since all licensors might not fully understand the rights they are granting and might challenge licensees on technicalities. From my reading of the Kappa Map court opinion, it seems that Kappa Map’s actions were certainly within the spirit and made with the intent of full compliance with the Creative Commons license. Fortunately for Kappa Map, the court found the company to be in full compliance with all the technical minutiae of the license. Other licensees might not be as diligent – or as lucky.
Sometimes a Paid-For License Is Less Expensive Than a Free License. Using Creative Commons material is attractive because use is free and requires no direct permission from the licensor. But sometimes “free” results in substantial expense. Even though Kappa Map prevailed in the copyright infringement lawsuit, the company’s use of the Swain’s Lock photo resulted in fourteen months of litigation. The Copyright Act allows the prevailing party in a copyright infringement lawsuit to seek payment of its attorneys’ fees and costs by the other party. Courts have discretion in granting such awards. Kappa Map asked for but was not granted an award of attorney’s fees and costs.
The case is Drauglis v. Kappa Map Grp., LLC, No. 14-1043 (ABJ) (D.D.C., 2015). As of the writing of this post, the Swain’s Lock photo can be viewed here and the Kappa Map Group atlas cover featuring the Swain’s Lock photograph can be viewed here.
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A small business that offers performances of copyrighted music requires a public performance license from the copyright owner of that music. This licensing
requirement extends to all types of small businesses including barber shops, restaurants, retail stores, and gyms. It doesn’t matter whether the small
business offers the music from a live band, CDs, a DJ, or the owner’s iPod playlist.
Public Performance Licenses for Songs Are Easy to Obtain
The good news is that the small business owner does not need to hunt down the copyright owner of each song for a license. That’s because most songwriters
and their music publishers affiliate with a performing rights organization (PRO) and those PROs issue public performance licenses on the songwriters
behalf.
The United States PROs are ASCAP, BMI, and SESAC. Each PRO issues blanket licenses that allow venues to perform any song in the catalog of that PRO.
The cost of the blanket license depends on how extensively the small business uses music. The blanket license for a nightclub will be more expensive
than the blanket license for a grocery store that wants background music for shoppers.
What Happens to Small Businesses that Play Music Without a License
Small business owners should take seriously the public performance license requirement. PROs do monitor compliance. Since business owners do not always
understand how they can and cannot legally use music within their establishments, the PROs do incorporate music licensing 101 training into their tactics.
However, when businesses fail to comply, as a last resort, PROs have been known to send an agent to the establishment, note any songs from the PROs
catalog played by the establishment, and then sue the establishment for copyright infringement. Those lawsuits typically result in the business paying
a damage award of a few thousand dollars for each song played so businesses should take the PROs demands seriously.
Some Exceptions and Alternatives to Licensing
There are some circumstances in which a small business would not need a public performance license in order to offer music:
Fairness in Music Licensing Act/Home Style Exemption Act. A small business can play the radio as long as the establishment does not charge patrons
a direct fee for hearing the radio broadcast. For this exception, there may be limits on the number of speakers used in an eating establishment that
is over 3,750 gross square feet or in a non-eating establishment that is over 2,000 square feet.
Muzak. Piped-in music service such as Muzak may be suitable for businesses that want only background music. The music service takes care of
obtaining all the necessary licenses.
Live Performances of Songs in the Public Domain. Offering performances of songs that are no longer copyrighted might work for establishments
whose patrons like live performances of classical music.
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What Are Creative Commons Materials?
Some copyright owners may deliberately place their work into the public domain prior to the expiration of copyright protection. There are also hybrid situations in which a copyright owner may place her work somewhere in between the public domain and full copyright protection. This is where Creative Commons comes in.
Creative Commons is a non-profit organization that offers free license documentation copyright owners can implement to make their works more available for use by others. You can locate music, images, text, and video on the internet that comes with a Creative Commons license. There are different variations of Creative Commons licenses. Hence, if the material you want to use falls under a Creative Commons license or other open license, read the licensing information to determine which rights you may freely exercise and whether there are any conditions with which you must comply.
Should You Use Creative Commons Materials?
Use of Creative Commons materials is not risk free. The Creative Commons License waives only copyright restrictions. There may be other legal issues to consider before using the Creative Commons materials. These considerations include right of publicity, right of privacy and defamation concerns.
Creative Commons licenses often come with no representations, warranties, or indemnifications. Those are the guaranties from the rights owner that it is authorized to give you permission to use the material and that the material has no permissions problems. Without representations, warranties, and indemnification, you are taking the Creative Commons material as is and essentially using it at your own risk.
Less Risky Methods
Less risky methods I recommend for minimizing costs while expanding your universe of available materials include licensing works from smaller stock houses and from local, independent and upcoming artists.
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On the Art Licensing Blog, artist Paul Brent tells the story of how his artwork made an appearance on this week’s episode of Hawaii Five-O.
In his interview with Tara Reed, Paul wonders whether video production companies must ask artists permission for the use of their artwork. The answer is yes! The Copyright Act protects visual artwork just as it protects songs, films, books, and other creative materials.
Production companies that use artwork in a production without the artist’s permission can certainly be sued for copyright infringement (if the use does not qualify as a fair use). One of the best known cases is contemporary artist Faith Ringgold who sued after a poster of her Church Picnic Story Quilt appeared as part of the set decoration in an episode of the sitcom Roc. Even though the poster appeared for a total of less than thirty seconds, the court said it wasn’t a fair use. The parties ultimately settled without a trial.
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Exploitation is often used as a reference to the process of generating revenue from your songs and sound recordings. So where do you start in your efforts to make money from your music?
First, realize that there is a distinction between a song, which consists of the underlying melody and lyrics, and the recorded performance of a song. Each is a separate copyrighted work. Typically, each copyright is owned by a separate person or entity. Usually, the song is owned by the songwriter or the songwriter’s music publisher, and the sound recording is owned by the record company that released the CD. However, if you’re an unsigned artist making your own recordings, you’re most likely the copyright owner of both the song and the sound recording.
Being the copyright owner of a song or sound recording gives you certain exclusive rights. The exclusivity means that only you may exercise those rights, or authorize someone else to exercise those rights. You earn money from your songs by granting licenses to others to exercise those exclusive rights, and collecting the corresponding license income. This process of generating income from your songwriting is music publishing.
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While perusing the online Wall Street Journal, I came across a top story in the small business section: “Online Video Contest Gets People Talking” by Simona Covel. It relates the marketing success of Interwrite Learning, a maker of classroom technology tools, at using an online contest.
Interwrite invited teachers and students to send in videos of themselves performing their favorite songs, rewritten with new lyrics expressing the importance of technology in their classrooms. As a result of the contest, Interwrite received more than 200 videos which it posted online for comment, collected 27,000 leads, and increased its website traffic from 7,000 hits a month to 7,000 hits per week during the six weeks of the contest.
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It’s the internet age and many permission seekers wonder if it’s okay to get permission via an email exchange rather than via a more formal document. All contracts do not have to be in writing. Many oral agreements can be binding. In cases where an oral agreement would suffice, I would be comfortable relying on an email.
The grant of a non-exclusive license does not need to be in writing (although there may be circumstances in which you still want the non-exclusive license in writing). When you seek permission to incorporate third party music, text, artwork or other material into your production, you are usually – but not always – seeking a non-exclusive license.
There are other contracts that by law must be in writing in order to be effective. They include contracts for things such as:
For those contracts that must be in writing, I advocate a more formal agreement than an exchange of emails. There is at least one court that has ruled that an exchange of emails does not satisfy the requirement that the transfer of a copyright must be in writing. As we become more reliant on digital communications, that court attitude may change - but I wouldn't want to be the test case.
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