11 questions about music licensing

Music is one of the most important elements in establishing the mood in your restaurant, but under law, you must make sure you have the necessary licensing to comply with copyright statutes before playing it. Performing rights organizations (“PROs”), such as BMI, ASCAP and SESAC, act as intermediaries between restaurants and songwriters to protect intellectual property and make licensing more cost-effective and convenient. Restaurants pay a fee to the PROs for a blanket license that grants permission to use all of the music each organization represents, and they, in turn, distribute the fees, less operating expenses, to their affiliated songwriters, publishers and composers as royalties.

Here are answers to frequently asked questions about music licensing:

Q. If I pay a licensing fee to BMI, do I have to pay one to ASCAP as well?
A. It depends. If you know that all of the music you’re playing in your restaurant is under the copyright licensing of BMI, then the answer is “no.” However, if that music is licensed by either of the other two major licensing entities, ASCAP or SESAC, the answer is “yes.” If you aren’t certain about what music may be played, it’s safest to have licensing agreements with all three PROs – BMI, ASCAP and SESAC.

Q. What are the exemptions for radio and TV?
A. Federal copyright law, Section 110 (5)(B), exempts restaurants that play music transmitted via radio, TV and cable and satellite sources if they don’t charge to hear the music. Music played by other means, such as live bands, CDs, etc., aren’t covered by the exemption.

BMI: The Bridge between Music Creators and the Businesses that Use Music

Louisiana Restaurant Association members receive a 20 percent discount of music licensing fees by paying online.

There is no doubt that music is one of the quickest and easiest ways for restaurants to establish atmosphere and ambiance. But what many restaurant owners and managers have long known is now being supported by research: Music not only establishes ambiance, it also serves as a powerful tool for driving profits.

According to the Gallup Organization, one restaurant study revealed that low-tempo music can increase per dinner party bar sales 40.9 percent, and that patrons stay 24 percent longer when slow tempo music is played. Restaurant Management Magazine reported on a test titled "The Influence of Background Music on Restaurant Patrons," which revealed sales increased 11.6 percent when up-tempo music was played during lunch. Sales increased 15.7 percent when slower tempo music was played during dinner.

Music branding—the process of compiling playlists to suit an establishment’s brand and positioning--has become an increasingly popular consulting service, with a host of companies advising establishments on the right soundtrack to drive real business results, strengthen customer loyalty and enhance the dining experience.

To facilitate and simplify the process of licensing music for their members, more and more restaurant associations are partnering with Broadcast Music, Inc. (BMI)—and availing members of discounts as high as 20 percent off licensing fees.