Just because unlicensed music lawsuits don’t hit the front pages of news outlets doesn’t mean they’ve gone the way of the dinosaurs. While there were some notable cases in recent years regarding bars sued for playing unlicensed music, the plight of retail- and service-oriented businesses failing to procure the proper rights to play music in their establishments continues. A failure to play by the rules doesn’t so much effect the performers of the songs, but rather those who make a living by writing the songs.

Recent Cases

Earlier this year, for example, the American Society of Composers, Authors and Publishers (ASCAP) filed lawsuits against two Chicago area bars for using unlicensed music in their establishments. Both FatPour in Wicker Park and the Kirkwood Bar in Lakewood got hit with $150,000 in fines. A license would have cost just under $3,000 for FatPour and slightly more than $1,000 for the Kirkwood. Instead of pre-paying to secure licenses for their music, the bars went ahead, played unlicensed music and got caught.

In June, EMI Music group, backed by ASCAP, filed a lawsuit against Team Market Group, the owners of the Saddle Up Bar in Orlando, Fla. A license for their bar would have been less than $3,000, but they now face hefty fines, which are unspecified as the lawsuit is pending. Since Team Market Group refused past license offers, according to the lawsuit, they’ll be looking at fines far greater than the license would have cost in the first place, possibly $150,000 as with FatPour and the Kirkwood in Chicago.

The tune is the same across the nation. The Union Bar in Iowa City is also feeling the wrath of the ASCAP group and music copyright holders – as a similar lawsuit is being levied against them. While damages aren’t yet specified, you can bet the price of the license would have been far less than the fines they’re facing.

Why Do We Fine Unlicensed Music?

So what’s the deal with the fines? Every time a place of business, be it a retail shop or a bar, plays music of any kind, they legally must secure the proper licenses. It’s tempting to think that big name performers aren’t going to miss the profits from a paltry little music license, but that attitude is wrong. The profits don’t usually go to the performers who sing your favorite hits – they belong to the songwriters and rights holders who created and own those songs – the ones who can’t just go out and sell concert tickets and T-shirts to recoup the earnings lost when someone illegally plays their music.

If you don’t secure the proper licenses, which could include licenses from ASCAP as well as a couple of other agencies, depending on who holds the copyright to the song, you’ll face fines from all of them. The fines per instance of playing an unlicensed song once can range from a comparatively small $750 all the way up to a bank-breaking $30,000. And willfully infringing on copyright matters can raise a penalty of $150,000.

If small business owners believe that securing the proper licenses to play music in their businesses is costly, imagine the cost of paying off fines 10 times as much or more. Those fines alone can be the kiss of death for a struggling enterprise.

Who Needs Licensed Music?

A music license is necessary if you own an establishment – any type of establishment – and use music to entice patrons to visit.

  • A clothing store aimed at teens that plays the newest and hottest pop music needs a license for those songs.
  • A supermarket piping out the sounds of the golden oldies needs a license for those songs.
  • A bar that has a cover band paying tribute to their favorite hard rock classics needs a license for those songs.

The reasoning behind such licensing laws is because business owners are profiting from the music. The music adds to the ambiance of the store, bar or restaurant – meaning people are more likely to shop there. Because you’re profiting, it’s only fair that the songwriters and copyright holders share those profits.

Solutions to Music Licensing

[sc name=”FreeDemoLink”]So what’s a small business to do? You could spend your time securing the rights to the songs you want to play, which costs time that you (as a hurried business owner), probably don’t have – as well as money. Even then you can never be 100 percent sure you’re fully compliant unless you consult a lawyer, which may mean more money out the window.

However, small businesses do have the option of purchasing rights-secured packages put together by businesses (like Retail Radio) that specialize in making sure you get the music you want with the rights fully secured.

Using a company to secure the rights eliminates the legwork and legal headaches while covering your liabilities by providing a guarantee. You also have access – not just to specific songs you want, but to an entire catalog of rights-secured music you can introduce to your rotation when you want to shake things up.

No matter how you go about it, using licensed music is the way to go. You wouldn’t expect your hairdresser, plumber or bus driver to work for free, so extend the same courtesy to the musicians’ whose work you love: buy the licenses and avoid hefty lawsuits that could crumble your business.