Music Licensing Law

Under the Copyright Act of 1976, the owner of the copyright in a song is granted the exclusive right to "perform" the song "publicly" [17 U.S.C. 106(4)]. A song is "publicly performed" if it is played at a place open to the public or any place where a substantial number of persons outside of the normal circle of family and social acquaintances is gathered, which means virtually any business. Therefore, in general, if a business wishes to play music, it must obtain a "public performance" license from the copyright owner. While a business can technically obtain this license directly from the copyright owner for each song played, this is obviously impractical. More practically, a business may subscribe to a background music service which includes these royalties. In effect, a background music service collects the public performance license fees as part of its monthly music service charge. Background music services pay a lower license fee per business than the business would pay directly, so using a service is typically a more economical path, not to mention less paperwork.

1998 changes to copyright law carved out an exemption allowing businesses, under certain circumstances, to avoid the need to obtain public performance licenses.

Click here to determine if your business is exempt.