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1 June 2011
Troy Cooper, a 25 year veteran of the music industry talks music licensing
Plugging in an iPod or letting staff play their favourite CDs may not only be costing you customers but without the right music license your venue could be up for a hefty fine.
Everyone knows that music is an integral element in the success of a venue. It helps create the right ambience, which in turn can attract the right kind of patron. It's just as important as happy courteous staff, the right lighting and comfy furniture.
Music that matches the environment can extend the stay of a customer and encourage them to spend more. Likewise, the wrong music choice can drive people away.
So now we've determined that music is a must, where should I get my music from? These days, music is everywhere. You could try your luck on the illegal file sharing sites on the internet or maybe just copy a friend's CD. However, music piracy is just not worth the risk, especially in business. Whilst the record industry has to date been fairly lenient towards prosecuting individuals, businesses that are breaking music copyright laws have not been so lucky.
In July 2010, the Phonographic Performance Company of Australia (PPCA) went after a Queensland nightclub for not having the correct licenses in place. The Federal Magistrates Court issued a judgment against the club as well as the director and former director of that company. The Court ordered that the company and the directors pay PPCA $145,332.95 in tariff E1 license fees for the venue (this included back fees for the whole of the three year period over which PPCA had been writing to the club about its licensing obligations) as well as interest on that sum of almost $15,000.00. The Court also awarded PPCA additional damages of $90,000, sending a clear message to copyright infringers that such conduct will not be tolerated.
Many business owners assume they have the 'right' to use any music they want... who will know anyway?? Just the other day I was at a coffee shop and was watching as a staff member changed the CD (from AC/DC!), when she opened the door to where the CD player was stored, out popped about 12 copied CDs all with the telltale black marker pen description on the cover.
If you run a business and use music, you need to pay for the 'right' to use that music...simple.
So what music can I use legally I hear you ask? Let's run though them...
CD. These plastic coated little wonders have been around for almost 20 years and are still going strong. If you want to play CDs in your venue, you must have the original CD and the appropriate APRA and PPCA background music licenses.
iPod/MP3 player. These amazing devices store thousands of songs and are a great way to listen to music. One little known fact though is that any music purchased and downloaded from sites like iTunes or Bigpond Music is only licensed for personal use and should not be used in a commercial environment. So the only real way to use an iPod legally would be to copy the music from the original CD. Unfortunately it doesn’t stop here. To make a copy you must also have the two reproduction licenses needed from the copyright owners. The sound recording license is available from ARIA or directly from the record company. The musical and literary works reproduction license can be purchased from AMCOS.
Background Music Supplier: Designed to take the worry out of using music in a business, a reputable background music supplier is really a one stop shop that can supply the right style of music for your venue as well as having the appropriate licenses in place to cover all the music copying mentioned earlier. Normally you pay a monthly subscription and everything is covered. Some providers also own directly licensed content that can be played in restaurants and bistros without the need for a PPCA public performance license. In many cases the savings made in the PPCA fee more than covers the entire cost of subscribing to the music service. Recently, a well known franchised coffee chain swapped over to using directly licensed music and are now saving more than $200,000 annually in fees.
One message is clear though...using music in business is not free. I'm sure most business owners would rather pay a small monthly amount to ensure they're legal, rather than risking a fine (and the bad PR) if caught.
Article Written By: Troy Cooper - a 25 year veteran of the music industry and a specialist in music licensing.