BMI, ASCAP, etc. suing bars?

[henryrobinett]

I haven’t read the thread - has anyone ever found out total licence fee revenue generated by these companies, percent of revenue that goes to artists, which artists have seen greatest benefit, and what were those $ amounts?

If it’s a system designed to benefit artists/composers, then it should publish that info.

I get a break down when I get BMI checks and statements. It just shows, as I recall my percentage and what revenues were collected and where. It shows a breakdown of songs plays, countries, states, etc.

 

[MikeDV]

One thing I don't think I saw here - these agencies make their money collecting fees for the artists. I saw bunches say they're taking all the money, raping the artists, etc. That may be in some cases, because greed and big money leads to criminal activity sometimes. As I understand it (I learned all this years ago, and the business has changed greatly - but I don't think this has as it's primary function) BMI/ASCAP enforce the copyright laws in behalf of the owners (which we're talking about the musician/composer) by collecting fees from people that use the product in order to make money of their own. Bar owner 99.9% of the time hires bands because good ones draw customers and she makes more money. If she happens to be a real music person, cool, but it's done to keep the doors open. Licensing company has a formula (I'm pretty sure it's known in the industry as relatively standard) for venue sizes. The strip mall bar doesn't pay the same as the multi-story nightclub. This is all done according to laws that say copyrights are a thing of value, and if the owner wants to withhold the use of something, or ask a fee for it, that's enforceable. That's how they "bully" bar owners, they've got current laws on their side. Here's where I get fuzzy, maybe someone current can help explain - BMI/ASCAP negotiates fess OR has just has industry rates they charge to the copyright holders; those are the collecting costs they charge in order for them to exist.; the rest goes to the copyright owner. Now, old-school record labels, unscrupulous types, artists, their spouses from a divorce - can hold an artists copyrights. Many - especially at the start of the record business - artists were reileved of their copyrights, because they knew nothing about the business aspect and plenty of people were educated enough to gladly take advantage of them. So, while the artist might deserve the copyright as being an artist, those were originally theirs, they had to lose them or give them away somehow. They also sample live places, and have some kind of formula regarding what songs are played more, so those artists get bigger shares. Totally SWAG, because the cost of logging every single licensee personally would be too costly. So in order to somehow apportion amounts to the artists whose songs get played the most got a bigger percentage. It's lots of actual math, mostly contractural, and some scientific guesstimates. The changes in the music business have probably been a huge challenge for these companies. The way music is delivered has radically changed for good, and I think I've read that there are still different approaches to how various people can make money. But, and maybe this is why some folks have heard more about it lately - the formula still works for live music, bars, nightclubs, sat radio played. A girl's got to stay in business, right? I had a friend that had a job with BMI (or ASCAP, not sure) - he was paid to go to bars and log what music was played by what artists. I'm not 100% sure if they did that in a lot of places for sampling, or any of that logistical stuff. Relative original music in bars, if a bar owner does the only-original approach, there's a good chance it was a business decision. They figure that the live music draw will get an audience of people who are interested in hearing original music exclusively, and customers means beers sold. We all know that a good deal of people love to got to bars with bands, but they regard them as living jukeboxes, they want the familiar, and that's why they go to that bar. Nothing wrong with that, that's how cover bands roll and get to play. All-original - gotta' prove it, 'cuz BMI send folks in to listen - music played, no license fees. The owners of the music are performing it themselves. Learned all this years ago in school, just a gee-whiz observer in the music biz, since I'm just an amateur/sometimes get paid musican so I find it all interesting. If I've gotten how it is today wrong, somebody 'splain. If you've made it this far, pretty long post, huh?

 

[Fro]

I had a friend that had a job with BMI (or ASCAP, not sure) - he was paid to go to bars and log what music was played by what artists.

This is the part I was wondering about. That's cool that they actually send people out into the field to get a sampling of what is actually being played. I would think with todays technology there would be a more efficient way to do this. But truth be told, if you saw one band in one bar in my area, you pretty much know what everyone is playing, lol. Yes, we do all have "Don't Stop Believing" on our set lists. And "Fishing In The Dark" is pretty much a regional requirement. But I digress. Sounds like the system isn't too far off then. Now, since nobody is buying my music, I need to get people to play it live!

 

[solo-act]

I get a break down when I get BMI checks and statements. It just shows, as I recall my percentage and what revenues were collected and where. It shows a breakdown of songs plays, countries, states, etc.

Thanks - does it separate out revenue from live music licenses?

In a perfect world, there'd be reports for live music license revenue from small venues (less than 75 or 50 seating capacity). These venues often tell me they're being very aggressively pursued, multiple calls per day, every day, by three agencies as well as in-person contact.

I'm curious who the majority beneficiary is in a game that decreases customer exposure to product (live performance of covers) vs. increasing customer exposure to product -- which might help generate more streaming, subscriptions etc. of that product (industry needs all the help it can get). You think the latter would help grow revenue, but apparently the former is where all the short-term money is.

These small venues tell me they're being asked to pay for the same product three times over: On a jukebox, on any streaming device that runs when customers aren't using the jukebox, and for the live music. And not based on actual foot traffic, but maximum seating capacity -- as if that small venue is packed 7 days a week. That's what I hear on the street.

I also hear they don't threaten venues that CAN afford to meet them in court; they threaten the little ones who can't. It's very aggressive and relentless so there must be a lot of money in it. Question is how much, and how much of that specific revenue goes to artists?

The pessimist in me is thinking revenues are down since overall industry revenue is down; they're filling that gap through aggressive pursuit of small live venues; and they're not clearly separating out that specific part of their revenue because it's making up the difference.

I'm guessing there's some kind of oversight or regulation in place. If so, a breakdown of revenue and payout from pursuing license fees in smaller venues would be available somewhere.

 

[solo-act]

Now, since nobody is buying my music, I need to get people to play it live!

First problem is finding a venue that can afford to have it played live - LOL, case in point above. There's arguments on both sides - I just want to see the numbers.

 

[Fro]

I just want to see the numbers.

Yeah, I would be curious to see what the per song rate is in a 200 capacity bar. We're all too familiar with how little the money is on an internet stream, so I wonder how it compares. It would be interesting to see if the per song rate multiplied by a 50 song show 2 or 3 nights a week over 52 weeks adds up to what the bar pays as a yearly licensing fee. Of course, understanding that there are some expected operating costs for ASCAP and BMI. And that the bar may also have a jukebox for when bands aren't playing.

 

[iaresee]

Yeah, I would be curious to see what the per song rate is in a 200 capacity bar.

I'm going from memory here, but IIRC that's not quite how it works. Bars pay a monthly fee based on their capacity and a few modifying factors like whether or not they have an open patio. That fee goes into a pool of money. The pool of money is distributed to content owners based on statistical sampling of bar play, radio play, etc. There's no accounting for "number of songs played in the bar". Play 1 or 100 songs -- you're paying the same licensing rate.

If you're a license holder for content that literally never gets played live or in traditional media, you're getting $0 from that pool of money every month.

I'll try and find the link, but there was a report done over a decade ago during the rise of the streaming services that made it pretty clear that unless you're in the 75th percentile or higher for popular music in any month, you're not getting anything from that pool of money -- payouts from that pool are dominated by "popular music" (but not necessarily Pop Music, the genre). Case in point: I know songs I've written are played with some suuuuuper minor frequency in Canadian bars, so I should like like a $1/month maybe? I get $0. Sampling never sees that my song is played enough to get any money from that ASCAP or BMI money pool. That's just how it is.

For streaming services, no statistical sampling is employed. Instead precise play rate data is reported by the services and royalties are charged on that data. So, while the royalty rates on those services may seem low the precision ensures fairer payments and, of course, their reach is FAR greater than terrestrial radio or bars, so your potential audience for streams is much, much larger. Comparing my specific situation to the pool of money scenario above, I DO get a few dollars a month for streams of content I own the license to. It's a pittance, but it's an accurate pittance.

 

[Fro]

I'm going from memory here, but IIRC that's not quite how it works. Bars pay a monthly fee based on their capacity and a few modifying factors like whether or not they have an open patio. That fee goes into a pool of money. The pool of money is distributed to content owners based on statistical sampling of bar play, radio play, etc. There's no accounting for "number of songs played in the bar". Play 1 or 100 songs -- you're paying the same licensing rate.

If you're a license holder for content that literally never gets played live or in traditional media, you're getting $0 from that pool of money every month.

I'll try and find the link, but there was a report done over a decade ago during the rise of the streaming services that made it pretty clear that unless you're in the 75th percentile or higher for popular music in any month, you're not getting anything from that pool of money -- payouts from that pool are dominated by "popular music" (but not necessarily Pop Music, the genre). Case in point: I know songs I've written are played with some suuuuuper minor frequency in Canadian bars, so I should like like a $1/month maybe? I get $0. Sampling never sees that my song is played enough to get any money from that ASCAP or BMI money pool. That's just how it is.

For streaming services, no statistical sampling is employed. Instead precise play rate data is reported by the services and royalties are charged on that data. So, while the royalty rates on those services may seem low the precision ensures fairer payments and, of course, their reach is FAR greater than terrestrial radio or bars, so your potential audience for streams is much, much larger. Comparing my specific situation to the pool of money scenario above, I DO get a few dollars a month for streams of content I own the license to. It's a pittance, but it's an accurate pittance.

This falls in line with how I understood it to work. I just didn't know if things had changed. I know someone mentioned people they knew that were employed by the agencies that would go to bars to notate what was played, but it sounds like that didn't really have any impact on the formula being applied.

Yeah, the few dollars a month isn't much for the internet streams and such, but I do know its an accurate account, and I'm grateful to get it. It's actually pretty cool to see a very detailed breakdown in all of the reporting I have access too through ASCAP, Spotify and CD Baby. I can actually see small spikes based and things I do online, at shows, video releases, etc. It's also cool to see the worldwide access to my music, even in the little amounts it is. I can understand that it's asking a lot to apply this same high tech data collecting processes to corner bars in the middle of nowhere. I just figured in this day and age it could be more accurate. But I guess even for the big acts, the real money they are making with live performances is for the performance itself, not necessarily the royalties for the music being performed.

Thanks for all of the info! Like I said, I am almost 100% certain nobody is performing my music, that I know of. I'm more curious of the process than anything. I know there is a section when you log into ASCAP that says "Report A Concert Performance". Has anyone ever utilized that? Probably doesn't make a difference in a bar setting, but maybe on a larger scale, for those lucky enough to be in that situation?

 

[iaresee]

This falls in line with how I understood it to work. I just didn't know if things had changed. I know someone mentioned people they knew that were employed by the agencies that would go to bars to notate what was played, but it sounds like that didn't really have any impact on the formula being applied.

AFAIK that's always been part of their random sampling process. And it's also how they find bars that are playing music but not paying.

 

[lqdsnddist]

I've been to many a small dive bars over the years that would serve "after hours", when they knew just some regulars where in attendance, and they'd lock the front doors, put up the "closed" sign, and keep the beer flowing....

Perhaps in the future, when a small venue can be assured that "the man" isn't sampling content in their premises, they can lock the doors, turn on the "closed" sign, and play some AC/DC on the stereo for a handful of customers without fear of getting sued LOL

 

[iaresee]

Perhaps in the future, when a small venue can be assured that "the man" isn't sampling content in their premises, they can lock the doors, turn on the "closed" sign, and play some AC/DC on the stereo for a handful of customers without fear of getting sued LOL

Do you think those places would mind if I used their bars from time to time for my private events without compensating them?

 

[lqdsnddist]

Do you think those places would mind if I used their bars from time to time for my private events without compensating them?

Yes... I'm sure they realistically would mind....

I'm just making a bit of light of the situation, and find the idea that fear of "the man" (who perhaps is working diligently for the due rights of the artist) could result in a future bar landscape where live/recorded music becomes essentially "underground".

I grew up in an era, right or wrong, where live music was on stage most nights, typically poorly done covers, and likely with little compensation to the original artist, and when said live music wasn't on, there was always a juke box, or sometimes just the bar staff playing CD's from their personal collections.

If they had a tv they also probably had Monday Night Football playing, even without express written permission from the NFL lol

Maybe that era was in the wrong, maybe artists got screwed, but it was pretty much the post work/weekend entertainment for a lot peoples youth, and there music which essentially provided the "soundtrack" for it. Its an odd thought to think that some venues might start doing away with live music, juke boxes etc, if they don't want to "pay to play" so to speak.

I'm talking half-joking here, but at the same time, its a real question of how things are going to look moving forward ?

 

[lqdsnddist]

Perhaps Lars from Metallica said it best when he said "Sharing is great....when its not your stuff"

 

[MikeDV]

https://www.ascap.com

I couldn't find it on the web site, haven't read it all, but else where I saw $3.33 x the occupancy of the place, with a minimum of $356/year. So any size bar up to about 100 occupancy pays $356, and it goes up from there by size. There's different stuff for different venues. I just remembered, a new law was signed that addressed newer issues, but haven't read about that yet, either. Didn't look at BMI. I think you pay for both, and it's probably similar. So the local strip mall bar probably pays $750-1000/year for licensing for live music.

 

[solo-act]

https://www.ascap.com
So the local strip mall bar probably pays $750-1000/year for licensing for live music.

*last time on soapbox*
If that's minimum, it's probably music only 1x a month or less. I'm hearing yearly fees are around $3,000 for live music 1X/week with solo act and any music piped through system (venues are not going silent before/after a live performance). That doesn't include required cabaret license if anyone stands up and starts dancing. I have friends opening a brewery, and they're considering live music only 1x/month to minimize licensing fees. From my perspective licensing is definitely suppressing the live music market.

As mentioned, if any artists/composers are benefitting, it's the mega-hit artists played most often by most bands and all or nearly all money goes only to those artists. Question is how much, and I'm not sure those numbers are published.

Saying these smaller venues need to be aggressively pursued for licensing in order to support struggling artists/composers is misleading. To me it makes sense to assess fees based on real numbers such as net profit (cashier totals and overhead) only when live music is playing, and overall net profit minus that for house music the rest of the time. That isn't rocket science and would represent fair assessment vs. maximum seating capacity and charging 3X for the same product (covers played by band, juke box, and streaming).
*off soapbox*

 

[MikeDV]

Just passing along what I'm reading. "What I'm hearing" is similar to "everyone says" - zero credibility except as individual stories. These stories come from bar owners looking to make more money and artists who want to monetize their art. As the web site shows, there are licenses for various delivery systems of entertainment, so a particular venue could be charged $3k/year. I didn't see any frequency, amounts of music, etc., just annual fees based upon occupancies. There may be frequency costs, but I'm not reading contracts, just reading a web site. But TV, satellite, whatever passes for juke boxes (Sirius, etc.) all charge or have built-in licensing fees. If artists are going to be paid, this is one way of doing it. Paying a percentage off of net income? I don't think so, REAL reporting would exist in even smaller numbers than they do for income taxes. Artists would end up with even less. Artists want fabulous dollars for their efforts, business owners want that stuff for free. How you see this depends on which side makes you your money. Best is to write published songs, receive payments for the use of copyrights, and own a bar and pay the licensing fees which end up paying you... One person's being "aggressively pursued" is another person's "hey, pay me for what I've done that you use to make money." What does a glass of beer cost? Like, $.25? Add in overhead (employees, rent, etc.), add in profit - $3.50/beer. Like tube amps and modeling - context/perspective important. Maybe a few actual bar owners could chime in and give us some real-life situations and numbers.

 

[zionplayer]

So this is the kind of stuff that drives me to drink... just for fun I just went thru the www.ascap.com website, assumed I had an rest/bar/grill occupancy of 100, only DJ/Karaoke and streaming/recorded for music, and the yearly fee was $950. Then I compared steaming/recorded music and Live band more than 3 days a week, fee was like $850. Still gets you around the $3k per year with all three license agencies. That's whats crazy to me - why isn't it one agency! Can I write my song, start my own agency with my one song, get my cover band to play that song in its performances, then charge the same license fees that the other guys do because it doesn't matter how many times the song is performed! Pay me or I will sue you, even if your venue never plays my licensed song...

And we need to tell the bars Live Music is less expensive than DJ's & Karaoke!

 

[MikeDV]

Not sure I'm on the same math page as you, what's the third agency - those two items you listed don't add up to $3k. Is there another US licensing group? I think that different artists have licensing deals - BMI or ASCAP or the international one. I have always wondered why there isn't just one - one of the things I forgot from those classes. Wish I had paid closer attention. How do those that you listed combine - is the assumed bar doing all of those things, and why? Hard to really line up on this, at least for me. As an artist - I certainly want to make money on my music, so quit yer whining, it's the only system there is. As a business owner, crap - something else that cuts into my profits and/or makes it hard for me to be in business. As a regular walk-in drunk, I would think (although it most likely wouldn't go this way), get rid of all those costs, and a beer might only cost me $1 while I get to listen to my favorite music - live or recorded. It is what it is, right now. You want to be in business and use other folks' music to draw people? Pay up or shut up or change the laws or open a sprinkler repair business. Yep, the little, little venue has to pay a lot, definitely seems unfair. Billy Joe Johnson guitar hero needs to work a day job, even though he wrote/recorded/distributed a sublime masterpiece. Agreed - live music the way to go - but very prejudiced as a musician. I'm sure DJ's, and the huge amounts of people that like them, would disagree.

 

[zionplayer]

Understand and agree - very confusing. SESAC is the third one. And I am just passing on what I read - I am sure others with real world experience can add more detail to the conversation.

So I assume a club could say “ok band, we only have BMI so your set list can only be BMI licensed songs?” And any streaming would have to be a BMI channel. The way I read it, if 1 sesac song gets played that year the club is non- compliant without a sesac license (or ascap or BMI - you get the concept). Guess I am just wishing there was a better system.

 

[stereotactic]

As someone who owns a business and a BMI artist, the system is terrible and unfair to business owners and the bands that play in them alike. In my location, public performance license fees per year amount to 1000’s for live performance venues, just above 1000 per year just for recorded music only.

The money does not go to the particular artists who wrote the songs in any precise way, or mostly not at all, but rather to a pool of bigger artists who lay claim to the majority of it simply by their larger market share of music which is actually paid for directly by consumers and public broadcasting. I would be interested to know how these charting artists “negotiated” such a deal in the first place, we all should. This is the same way as the juke box era, before digital music, despite the fact that we could easily keep track of which songs are played how many times thanks to iTunes, Spotify, etc, or having a band submit a set list. The emperor hasn’t even bothered to change his clothes.

The idea that anybody should pay money to performance societies to play a Howling Wolf song so they can then give it Niki Minage, is completely wrong on every imaginable level. And every sensible musician and business owner ought to demand proper accounting be done if we are to hand over what amounts to huge monies in essentially a legalized extortion racket to people who have negotiated smaller artists rights away in favor of bigger ones.

Furthermore, there is no way to know how much of a venue’s sales are due to the music being played, and gets more and more vague in a recorded music situation. Sometimes you can barely hear the music in a bar or restaurant. If I don’t like the music that comes with my meal, can I get a discount? Does the venue get a credit with the performance society if the restaurant gives me that discount?

What’s the solution? Proper accounting and lower fees will get more businesses to comply, in my case happily so. I want Howling Wolf’s heirs to get every red cent due to them. Drake has no right to his money on an ethical and probably legal level. Digital media should make this easy, but as I said above, entrenched interests and old fashioned copywrite law makes that undesirable for the big players. This is crony capitalism at its worst, and that it’s being done in the name of intellectual property adds insult to the injury.

Crony capitalism is redistributionism in reverse, the efforts of the many subsidizing the few at the top of the food chain. Every regulatory fee you pay to some huge unresponsive entity like the performance societies is money a business owner cannot pay their musicians or employees. This drives up the cost of business and pushes the smaller ones out of business. Who’s left? Live Nation and chain restaurants. That’s not competition or free choice or anything like the world I want to live in, and it needs to stop. There is probably a legal remedy along anti trust lines. I wonder what the performance societies would do if confronted by a class action lawsuit of the thousands of artists whose royalties are being diverted to pay Maroon 5 and Rhianna...