1Why a licence is needed at all
Section 106(4) of the US Copyright Act gives the owner of a musical work the exclusive right to perform it publicly. A performance is public when it happens somewhere open to the public or to a substantial number of people outside a normal circle of family and friends. A dining room, a shop floor, a gym and a waiting room all qualify.
Buying the music does not help. Owning a CD, or paying a monthly subscription to a consumer streaming service, gives you the right to listen privately. It does not give you the right to perform the recording to your customers. Those are separate rights, sold separately.
Two sets of rights are in play. The composition, meaning the melody and lyrics, is controlled by songwriters and publishers, and this is what performing rights organizations license. The sound recording, meaning the specific recorded performance, is controlled by the label. For ordinary background music in a physical venue, the composition side is what generates the invoices you receive.
2Who the four PROs are
The United States is unusual in having four performing rights organizations rather than one. Each represents a different set of songwriters, and none can license the others' repertoire. Because a normal playlist mixes writers from all four, most venues that play mainstream music are told they need all four licences.
| Organization | Notes |
|---|---|
| ASCAP | Non-profit, member owned, the largest by writer count. Operates under a federal consent decree. |
| BMI | Now privately owned. Comparable repertoire size to ASCAP. Also historically consent decree bound. |
| SESAC | Invitation only and privately held. Smaller catalog, no consent decree, so rates are less constrained. |
| GMR | Founded 2013. Small but high value catalog of very heavily played writers, which is why it can charge despite its size. |
There is no single window. You negotiate, pay and renew with each one separately, and each audits separately.
3What it costs in 2026
For a small venue in 2026, the minimum general licence runs to roughly $402 a year for ASCAP and roughly $415 a year for BMI. That is about $817 before SESAC or GMR quote you anything, and before any of them apply the multipliers described below.
Those are floors, not typical bills. A restaurant with a patio, a hotel with several public areas, or a gym running classes will be assessed well above the minimum. Businesses that use music as a draw, such as bars with dancing, pay on a different and higher schedule again.
PROs routinely seek fees for the period a venue was open and unlicensed, not just from the date you are contacted. A first invoice covering two or three prior years is common, which is why the real first-year number is usually well above the headline rate.
4How the fee is calculated
Every PRO publishes rate schedules that scale with the same broad factors:
- Gross square footage of the area where music is audible.
- Occupancy or seating capacity, which is often taken from your fire certificate rather than your own estimate.
- Number of speakers and rooms, including patios and outdoor areas.
- How music is used. Background music is the cheapest tier. Live performance, DJs, karaoke, dancing and cover charges all escalate the rate.
- Whether you charge admission, which moves you to a higher schedule.
Because the inputs are physical, the bill grows every time your business does. Adding a patio, extending your hours or knocking through a wall can all raise it, and none of that gets you a single extra song.
5The small business exemption
Section 110(5)(B), added by the Fairness in Music Licensing Act of 1998 and often called the business or homestyle exemption, does let some venues play music without a PRO licence. Owners regularly overestimate how far it goes.
It can apply where:
- the premises is a restaurant or bar under 3,750 gross square feet, or any other business under 2,000 gross square feet, excluding parking areas;
- or the premises is larger but stays within the equipment limits, being no more than six loudspeakers in total and no more than four in any one room or adjoining outdoor space;
- no direct charge is made to see or hear the transmission; and
- the transmission is not further retransmitted beyond the premises.
The exemption covers ordinary radio and television broadcasts only. It does not cover Spotify, Apple Music, Pandora, YouTube, CDs, downloads, or a playlist on a phone. The moment a member of staff plugs in a phone instead of tuning a radio, the exemption stops applying, whatever the size of the room.
6What consumer streaming does not cover
Personal subscriptions to Spotify, Apple Music, Amazon Music, YouTube and Pandora are licensed for personal, non-commercial listening. Every one of them prohibits commercial use in its terms of service, so playing them in a venue breaches both the contract and the public performance right. Paying for the family tier does not change this.
We cover this in more depth in can I play Spotify in my business.
7Penalties for getting it wrong
Copyright owners can elect statutory damages instead of proving actual loss. Under 17 U.S.C. 504(c) these run from $750 to $30,000 per work infringed, rising to $150,000 per work where the infringement is found to be willful. Courts can also award costs and attorney fees.
Per work matters. A licensing suit is rarely about one song. Investigators typically log a set of songs during a visit, and each becomes a separate count, which is how modest venues end up facing five and six figure claims.
8Your four options
| Option | What it means |
|---|---|
| Licence directly | Pay ASCAP, BMI, SESAC and GMR separately, renew and renegotiate with each. Full mainstream catalog, four bills, no music supplied. |
| Commercial streaming | A business service such as Soundtrack Your Brand, Cloud Cover, SiriusXM Business or Jukeboxy bundles the PRO fees into a monthly price. Typically $27 to $45 a month per location. |
| Rely on the exemption | Broadcast radio only, within the size or speaker limits, no charge to listen. Free, but fragile and easy to break by accident. |
| Royalty-free catalog | Music licensed at source, registered with no US PRO, so no performing rights royalty arises. One flat fee. Not the Billboard chart. |
Which is right for you. If your customers expect current chart music by name, you need mainstream repertoire, which means direct licences or a commercial streaming service. If what you actually need is the right atmosphere and no legal exposure, a royalty-free catalog does the job for less and removes the PRO relationship entirely.
RadioB2B is the royalty-free option
1,200+ curated stations and background music video channels, licensed at source and registered with no US performing rights organization. One flat $249 a year, with a Music License Certificate you can show to anyone who asks.
9Common questions
Do I need a music license for my business?
If you play commercially released music where customers or staff can hear it, yes, unless the 110(5) exemption applies to your premises and you are using broadcast radio or television. A royalty-free catalog is the other way to answer the question, because there is no PRO repertoire in it to license.
Do I need all four PRO licenses?
If you play mainstream music, in practice yes. Each PRO licenses only its own writers, and a normal playlist crosses all four. Holding only one or two leaves you exposed to the others.
What if I only play the radio?
Ordinary broadcast radio, within the size or speaker limits in section 110(5)(B), with no charge to listen, can be exempt. Internet radio and streaming simulcasts are not the same thing and are not covered.
Does my music service already cover me?
A commercial business music service normally includes the PRO fees for music played through that service. It does not cover other music at your venue, such as a live band, a DJ, karaoke, or a staff phone connected to the speakers. Check what your provider actually covers.
Can I be fined for music playing in a staff area?
Performances to staff only, out of customer earshot, are treated differently, but the moment customers can hear it, or the number of people is substantial, it is a public performance.
Rate figures reflect published 2026 general licensing minimums reported by industry guides and are indicative, not quotations. Statutory damages and exemption thresholds are as set out in 17 U.S.C. 504(c) and 110(5)(B). Nothing here is legal advice. See our Terms of Use.