Whether it’s background music in a boutique or live entertainment in a restaurant, music can elevate the customer experience. But for businesses, playing music publicly isn’t just a creative choice, it’s a legal one. If your business uses music in any public setting, you may need a license from a performing rights organization (PRO) such as ASCAP, BMI, or SESAC.

What Are Performing Rights Organizations?

PROs are entities that manage the public performance rights of musical works on behalf of songwriters, composers, and publishers. They collect licensing fees from businesses and distribute royalties to the creators of the music. The three major PROs in the U.S. are:

• ASCAP (American Society of Composers, Authors and Publishers)
• BMI (Broadcast Music, Inc.)
• SESAC (Society of European Stage Authors and Composers)

Each PRO represents a different catalog of music, so businesses often need licenses from multiple organizations to cover the full range of songs they may play.

When Is a License Required?

Under U.S. copyright law, playing music in a business setting typically qualifies as a “public performance,” which requires a license. This includes:

• Playing recorded music from CDs, MP3s, or streaming services
• Hosting live music performances (including cover bands)
• Using music in videos or presentations
• Playing music on hold for phone systems
• Broadcasting music via loudspeakers in public areas

Even if you’ve purchased the music (e.g., a CD or digital download), that purchase only grants you private listening rights—not the right to publicly perform the music.

Common Business Types That Need Licenses

• Restaurants and Bars: Especially those with live music or curated playlists
• Retail Stores: Playing background music for ambiance
• Gyms and Fitness Studios: Using music during classes or workouts
• Salons and Spas: Enhancing the customer experience with relaxing tunes
• Event Venues: Hosting weddings, parties, or corporate events with music

What Happens If You Don’t Comply?

Operating without the proper music licenses can expose businesses to legal risk. Performing rights organizations actively monitor public music use and may reach out to businesses they believe are using music without authorization. If a business is found to be in violation, it could face enforcement actions, which may include demands for licensing fees and potential legal proceedings.

While the financial consequences vary depending on the circumstances, they can be significant, especially if multiple songs or repeated violations are involved. In addition to monetary penalties, businesses may also incur legal costs and reputational damage.

To avoid these risks, it’s best to proactively assess your music use and secure the appropriate licenses before issues arise.

How to Get Licensed

Each PRO offers online portals where businesses can apply for licenses. Fees vary based on:

• Business type and size
• Whether music is live or recorded
• Frequency of music use
• Whether admission is charged

Costs can range from modest annual fees to more substantial amounts for venues with extensive music use.

Final Thoughts

Music is a powerful tool for shaping customer experience, but it comes with legal responsibilities. Businesses should assess how they use music and ensure they’re properly licensed with all relevant PROs. Consulting with legal counsel can help navigate the licensing landscape and avoid costly pitfalls.