My response to the Peloton Interactive lawsuit by the music industry has garnered a lot of interest with some of the responses mirroring what I've seen from creative clients. Basically "I understand going after the big companies, but why would they care about the little guys and small companies? What is that going to hurt?"
It could hurt the music industry dearly.
I'm not a lawyer and it would take pages and pages to explain all of the legalities, but here's a basic primer on what you need to know and understand about music licensing.
Personal Use.
When you purchase a song or an album you are paying for the right to listen to music personally. Via your mobile device, home theater system, in your car, etc.. In other words, personal use, you're not charging any money for anyone to listen to that music.
Commercial Use.
When you use the music in a commercial way, that is in a way that you will be charging people for your services or event or a myriad of other ways to charge people, you are legally required to pay for licensing that music. That license generally needs to be approved by the song writers, the singer and the label that distributes the original song. Any of those three can reject your request. Depending on your use, fees can be minimal to millions of dollars.
Sync License.
To use commercial music in a video, no matter how it is distributed, you are required to get a sync license. That is a license that allows you to synchronize your video to the music and lyrics of the song. That license generally needs to be approved by the song writers, the singer and the label that distributes the original song. Any of those three can reject your request. Depending on your use, fees can be minimal to millions of dollars.
I was creating a local commercial for an Atlanta-based entity that wanted to use I'm Into Something Good by Herman's Hermits. The band approved the use but songwriter Carol King rejected it. She did not want her song associated with that particular product. The fee was to have been $15,000 for one month of local broadcast use. We used a music library track instead that had the same feel and vibe of the original.
Commercial Streaming.
Many commercial locations, such as gyms, restaurants, entertainment complexes and the like use commercial music streaming services such as Pandora for Business. Those services collect the licensing fees as part of the regular subscription. Pandora's website even has an icon "No Problems" on their front page referencing licensing.
Why This Matters, even for the little guys.
When the record label, song writers or artist discover that their music is being used illegally without proper licensing, they are obligated to initiate legal action. To knowingly allow a third party to freely use their music jeopardizes the right of those entities to control the music. If they do not defend their rights to license the music, worst case scenario, the music enters the public domain which means is freely distributable and useable by anyone.
They are also obligated to defend the license to protect their partners, like Pandora, who do pay the licensing fees. To force one company to pay fees and allow another to bypass them could cause additional legal and financial headaches.
Both scenarios could cost a company and an artist a lot of money in lost revenue.
So the lawyers will approach a large company like Peloton and a small business like your corner gym once they become aware that a music license violation is happening.
My experience has been that they don't jump to a lawsuit. Usually you're issued a cease and desist letter first. Depending on the situation, the severity of the violation, the length of the violation that letter would be accompanied by a request for payment to satisfy the past use.
Just Don't Do It.
Again, I'm not a lawyer and you should consult an entertainment attorney who specializes in music licensing before you create a project or use commercial music in your business.
But.
If you are a commercial entity of any kind, from a one-man operation to a multi-billion dollar company spread around the world, don't use commercial music in your media, marketing, social media or even internal events unless you're prepared to pay proper licensing.
ASCAP is one of the largest music licensing entities in the world. Here's a link for more reading on the subject.
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Walter Biscardi Jr. is the Executive Creative Director at High Road Craft Brands in Marietta, Georgia where everything is made from scratch by chefs. He is a 30-year veteran of storytelling and branding for a global audience. He's built multiple creative operations encompassing video, graphic and web design while managing teams of up to 100 people. He’s created original content for networks such as Food Network, PBS, CNN, The Weather Channel and Sky News and for brands such as Sesame Street, PING, The Home Depot, Georgia-Pacific, High Road Craft Ice Cream, The Carter Center and the Bill & Melinda Gates Foundation. He is an author, sharing storytelling and production techniques for Lynda.com / LinkedIn Learning, CreativeCow.net and on WalterBiscardi.com. He's also the Creator of Contemporary Living Network, a lifestyle SVOD featuring quality edutainment and actionable, real-time purchasing. We call it, Life Worth Living. Credits and honors include multiple Peabody, Emmy and Telly Awards.