Why ASCAP Licenses Bars, Restaurants & Music Venues
If you’ve ever noticed how quickly a concert venue turns on recorded music between bands or experienced that strange silence when the music stops playing in a restaurant or bar, you understand how important music can be to a business. Like the quality of the food, drinks and atmosphere, music contributes to the success of the bars, restaurants and venues that we all frequent. The people who created that music have a right to fair payment for the public performance of their music. And the American Society of Composers, Authors and Publishers (ASCAP) exists to make this possible.
As a membership organization of more than 1.1 million songwriters, composers and music publishers, ASCAP understands how essential music is to local businesses. ASCAP’s efforts to license our members' music to businesses that rely on it have expanded in scope and sophistication over the years. But we’ve never let go of the personal touch so essential to the many thousands of bars, restaurants, music venues and other “general licensees” that thrive on one-on-one interactions for their business. The vast majority of establishments we approach recognize that music is vital to the total service they offer – both in attracting customers and in driving revenue. They know that an ASCAP license allows them to offer music legally, efficiently and at a reasonable price – while compensating music creators so they can earn a living from their work.
Sometimes our licensing operations are misunderstood, most often by local bar owners trying to avoid paying for the music that they use.
So, let's get back to the basics. Here are five essential facts to know about ASCAP’s general licensing practices, and why they’re good for music makers and music users.
1) Who We Are
ASCAP is a membership association that operates on a not-for-profit basis and represents more than 1.1 million songwriters, composers, lyricists and music publishers of every kind of music and at all stages of their careers, from those just starting out to the most successful names in music. We’re the only performing rights organization founded and governed by our members.
2) Public Performance is a Right
Professional songwriters and composers earn much of their livelihoods by licensing the rights granted to them by copyright law. One of these is the right of "public performance," which allows people who create music to make a living from their art - even when they aren’t the performing artists. ASCAP exists to protect that right by licensing the public performance of our members’ music.
3) ASCAP Connects the Creative and Business Communities
ASCAP’s licensing efforts benefit music creators and businesses. Songwriters and composers depend on ASCAP to license their songs to the hundreds of thousands businesses across the country that perform their music, leaving them free to do what they do best - make music. Businesses know that an ASCAP license is a worthwhile investment. With one payment, they can legally play more than 20 million musical works. Local artists can cover ASCAP songs in their sets without worrying about infringement. And since ASCAP is a membership association that operates on a not-for-profit basis, our licensees know that their license fees are going right back to the music creators who bring so much to their business.
4) ASCAP Licensing Fees Are Flexible and Affordable
We work hard to make sure any business seeking a music license is able to get one at a reasonable rate. Most of ASCAP’s licensees take out “blanket licenses,” meaning that licensed venues pay an annual flat fee without having to take on the time-intensive process of tracking and reporting on every song played. There are more than 100 different types of ASCAP licenses, and we’ve always adapted our licensing to reflect new ways that businesses are using music. Smaller operations may pay as little as a dollar or two a day.
5) Songwriters and Composers Are Small Business Owners, Too
Music is more than just an art form for ASCAP’s 1.1 million+ members. It’s also how they earn a living, put food on the table, send their kids to school. Like any business that offers a service or produces goods for consumption, songwriters have the right to be compensated when their music is performed - even when they’re not in the room playing it themselves.
What does ASCAP mean by "general licensee?"
"General licensee" is an umbrella term referring to the hundreds of thousands of bars, restaurants, hotels, ice and roller skating rinks, theme parks and other "brick and mortar" businesses we license that are not TV, radio or audio and audio-visual streaming platforms. There are many different ASCAP license available for the many types of general licensees. You can read more specifics at www.ascap.com/licensing.
Why should a business have to pay to play music in public?
We often use the expression "They're playing our song," not always remembering that while we may have emotionally adopted the song, it still legally belongs to the songwriter who created it, and the music publisher who markets it. When you use other people's property, you need to ask permission. An ASCAP license gives a music user simple, affordable access to the more than 20 million works in the ASCAP repertory.
Do business owners need to pay a fee if they're only playing recorded music like CDs, radio or TV?
In general, yes. Whether it's live or recorded, music is used by business owners to attract customers, and its creators have a legal right to be compensated. There are a few exceptions, depending on the size of the establishment and whether it charges an admission fee. For example, a food service or drinking establishment is exempt from licensing for radio or TV music uses if it has no more than 3750 gross square feet of space. Licensees can discuss their specific situation by contacting a ASCAP licensing manager.
How much do your general licensees pay annually?
Individual licensing fees vary based on a number of factors, including how a business uses music (live, recorded, audio only vs. audio/visual), its capacity, how many nights a week it hosts live music, etc. Smaller operations may pay as little as a dollar or two a day.
ASCAP offers more than a hundred different licenses, each with its own fee schedule, but we believe that similarly situated users should be treated similarly. For example, rates for restaurants of the same size, with the same use of music are the same regardless of whether the restaurant is in Oshkosh or New York City. You can find more specifics at www.ascap.com/licensing.
Why is the venue responsible for paying ASCAP fees? Shouldn't a musician, entertainer or DJ be responsible for obtaining permission?
Some people mistakenly assume that musicians and entertainers must obtain licenses to perform copyrighted music, or that businesses where music is performed can shift their responsibility to musicians or entertainers. The law says all who participate in, or are responsible for, performances of music are legally responsible. Since it is the business owner who obtains the ultimate benefit from the performance, it is the business owner who obtains the license. Music license fees are one of the many costs of doing business.
Are there any types of business that can perform music without having to pay an ASCAP license?
Permission is not required for music played or sung as part of a worship service unless that service is transmitted beyond where it takes place (for example, a radio or TV broadcast). Performances as part of face-to-face teaching activity at non-profit educational institutions are also exempt.
How does ASCAP go about licensing local businesses like bars and restaurants?
Education is key to the licensing process. Wherever possible, we try to educate businesses through Chambers of Commerce, trade associations, municipalities and more so that business owners know about the need to obtain music licenses in order to comply with Federal law. License fees are often negotiated with trade associations and are constructed to be fair and affordable.
When we find out about a new business in need of an ASCAP license, we send an introductory letter or e-mail that explains what we do, how an ASCAP license benefits the music community, and the business owner’s legal obligations under US copyright law. We generally follow up with a telephone call to answer any questions and explain how our fees are established. Many new licensees are surprised to find out that an ASCAP license could cost as little as $2 - $3 dollars per day.
Most of our general licensees are owned by savvy businesspeople who understand why purchasing an ASCAP license makes good economic sense. Sometimes, an uninformed bar or club owner will refuse to take an ASCAP license and willingly infringe upon our songwriters' rights. When that happens, we will sue them for copyright infringement on behalf of our members - but this only happens after many attempts to educate them about their obligations under Federal law.
How do you pay your members for live performances?
ASCAP collects set lists from both headliners and opening acts of the top tours and concerts each year, and pays the ASCAP writers of every song that was performed – even if it's a cover song. In addition to that, ASCAP members at any stage of their career can submit set lists from live performances through our ASCAP OnStage program. No matter how big or small the venue or where in the country it's located, if we license it, then our members can get paid by ASCAP when they perform there. We also conduct a separate sample survey of live performances at concert halls and educational institutions. You can find more information about live performance payments on our website.
Is there a connection between the fees that licensed venues pay and the ASCAP members that play there?
Yes. The royalties we distribute for live performances are based on the licensing fees paid by the venues where they take place, so there is a direct link between what a venue pays and who that money goes to. Many of our general licensees use recorded music but do not host live performances. Recognizing this, we set aside a portion of the fees paid by bars, restaurants and other general licensees for the royalty pool paid to ASCAP members for radio and audio streaming performances.
How much of the money that venues pay to ASCAP actually goes to your songwriters?
ASCAP operates on a non-profit basis as a membership organization. Our top priority is ensuring money gets back into the hands of creators. Nearly 90 cents of every dollar ASCAP collects goes back to members in the form of royalties, one of the lowest overhead rates in the industry.
Our payment system is very transparent - members receive detailed quarterly statements showing exactly when and where their music was played and how much it earned. They can view this information anytime online.
How do you know each music creator is getting their fair share?
ASCAP is committed to paying our members as fairly and efficiently as possible. We've invested in technologies that increase the accuracy and quantity of the performances we process, all while saving on operating costs, so we can put more money in our members' pockets.
ASCAP operates on a "Follow the Dollar" principle: the licensing fees we collect from TV networks go to TV music creators, the licensing fees we collect from streaming services compensate performances on streaming services, and so on.
Generally, royalties for a single musical work are the product of a calculation that includes a number of factors, including "weights" based on use, license fees, medium, and time of day, when applicable. When all of these factors are computed, we arrive at the number of total performance credits. The next step is to allocate these credits among all of the writers and publishers of the work based on the share each should receive. ASCAP is advised of the correct shares to be paid when members submit Title Registrations. For example, if two co-writers of a song share royalties equally, each will receive 50 percent of the total credits. The final step is to multiply credits by the appropriate credit value to arrive at the royalty payment.
What if a song was co-written by non-ASCAP songwriters?
In an effort to provide the industry with more clarity around ownership shares by ASCAP and BMI, we launched Songview, a comprehensive data platform that provides music users with an authoritative view of copyright ownership and administration shares in the vast majority of music licensed in the United States.
With this technology, ASCAP and BMI can seamlessly display an agreed-upon view of detailed, aggregated and reconciled ownership data for performing rights for more than 26 million musical works in their combined repertoires, including a breakdown of shares by ASCAP and BMI. And we made sure this information is accessible, free to the public, on both ASCAP's and BMI's websites.
Songview already provides an unparalleled level of song ownership data covering around 90 percent of all songs, but moving forward, ASCAP and BMI hope to work with other PROs to expand Songview and make it a viable solution for the industry writ large.
I've heard that ASCAP aggressively pursues unlicensed businesses. Is this accurate?
We provide an important service both to our members and to the hundreds of thousands of licensees that take out an ASCAP blanket license every year. Ever since the 1917 Supreme Court decision that upheld our right to license performances of our members' music in bars and restaurants, businesses that use music have had a legal obligation to obtain permission from the copyright owner. An ASCAP license makes it incredibly easy, efficient and affordable to legally play the 20 million+ songs in our repertory.
The vast majority of establishments we approach recognize that using music is vital to the total service they offer–both in attracting customers and in driving revenue. They see the ASCAP license as a normal and expected cost of doing business. So why shouldn't we seek to license restaurants or bars when others willingly comply? A business that claims music has no value to its bottom line is ignoring the hundreds of thousands of others that acknowledge just the opposite.
All ASCAP licensing representatives engaged in licensee relations also undergo robust training and abide by a Code of Conduct that fosters an environment of collaboration.
ASCAP employees must conduct themselves lawfully and with the highest level of professionalism, honesty and integrity. ASCAP's integrity - and its reputation for integrity - is essential to ASCAP's success and must not be compromised under any circumstances.
Why does ASCAP occasionally take legal action against small businesses?
We want every business that uses music to prosper. After all, more places to hear music means more money in the pockets of the songwriters, composers and publishers that we represent. But every now and then, a business makes the decision to ignore the legal rights of the music creators that help them make money. We only pursue lawsuits as a last resort after multiple attempts to negotiate with the licensee in question.
We do have a successful track record in the lawsuits we take out against bars, restaurants and clubs that infringe the copyright of our members. In past cases, several venues that could have paid ASCAP a very reasonable and affordable license fee ended up paying far more in damages in accordance with the law. It’s not a surprise that judges would decide in favor of ASCAP songwriters in these cases given Federal copyright law.
While litigation is never ASCAP’s preferred route, our responsibility is ultimately to our members. ASCAP operates on a non-profit basis, and we are a society founded and governed by – and for – people who create music. Our sole purpose is to support and promote the creation and performance of music.
Are you concerned that some smaller venues might stop hosting live music instead of paying their ASCAP fees or dealing with potential lawsuits?
Hundreds of thousands of licensees of all sizes recognize the value of an ASCAP license. And we’ve made our licenses both affordable and flexible – we determine our license fees individually based on how a business uses music and its size, capacity, etc. Smaller operations may pay as little as a dollar or two a day.
We of course recognize how important small venues are for emerging songwriters, and we want every business that supports the music community to stay afloat. But financial support is also essential to sustaining a music career. Songwriters have the legal right and ability to receive compensation from uses of their music, whether it’s in a neighborhood coffee shop or a venue they don't even know exists; and venues should expect to compensate the songwriters and composers whose music attracts customers and increases their bottom line. The more businesses that meet their obligations to pay for their use of music, the more that the economies of scale become a win-win for everyone involved.
MORE INFORMATION ABOUT ASCAP LICENSING:
ASCAP Licensing FAQ: http://www.ascap.com/licensing/licensingfaq.aspx
ASCAP Payment System: https://www.ascap.com/help/royalties-and-payment/payment
Contact ASCAP Licensing: https://www.ascap.com/music-users/license_request
Annual Report: http://www.ascap.com/annualreport
