Contracting Entertainers: Don’t Forget Your (Music) License

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Don’t Forget Your LicenseA Music License may be the last thing on your to-do list before your next big event. Music licensing is one of the most misunderstood topics within the intellectual property field.  Therefore, we hope this blog will clear up some of the confusion.

Legally, in order to play copyrighted music to the general public – even if you purchased it on iTunes – you must obtain public performance rights.

Now, how do you know if your function is considered a public performance? Copyright law defines public as “a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered”. For instance, music at a friend’s cookout or birthday party would not classify as public, but a nonprofit gala would.

Two large companies handle all the public performance licensing rights, ASCAP (American Society of Composers, Authors and Publishers) and BMI (Broadcast Music Incorporated), which makes the process fairly seamless. Each one handles a catalog of millions of songs. Therefore, purchasing both licenses would cover almost all music. If you want to play music in a lobby or elevator, you will need a commercial music services license through Muzak, a separate entity.

The company hosting the event must hold the license, not the event planner. Luckily, the licenses are good for one year and renewing process is quite simple.

Costs:

  • ASCAP bases its fees on the number of attendees.
  • BMI fees are a bit more complex.  For a special event with paid admission, the fee is based off a percentage of the ticket revenue.
  • For an event that is free to attendees, the fee is 1.5% of the total entertainment cost or $198.00, whichever is greater.
  • If you are hosting a benefit event, the BMI fee is based on seating capacity.
  • After deducting operating expenses, fees are collected and distributed as royalties to the artists.

Both ASCAP & BMI are associations representing 500,000+ members. These licenses protect the artist’s material and create a bridge between artists and those who want to play their music. Purchasing these licenses for your events is essential in order to legally play copyrighted music.