Music licensing is the licensed use of copyrighted music. Music licensing is intended to ensure that the owners of copyrights on musical works are compensated for certain uses of their work. A purchaser has limited rights to use and reproduce the recorded work without a separately arranged agreement.
Happy Birthday to You
The song ‘Happy Birthday to You’ is the best known song in the world and generates over $2 million in royalties each year for its copyright owners. The original author of the words to the song is unknown; however, the current owner is Warner Chappell, who receives licensing revenues through the ASCAP. The music itself was written in 1893, and due to multiple copyright extensions, will remain so until at least 2030. In 1989, when Time Warner first purchased the piece, movie licenses for the song were going from anywhere between “a few thousand” to $50,000. One reason the owner, Birchtree Ltd., decided to sell the copyright ownership was because they did not have a large enough unit dedicated to monitor its usage in new media. This became key in maximizing financial benefit, because previous owners failed to go after those who used the song without license for over 20 years.
Home Video
Licensing issues are often encountered when television shows or films using copyrighted music are released on DVD format.
When a song is cleared for usage on a TV show, historically to save money the clearance typically only applies to television airings of the show in question. Thus, when the show is considered for DVD distribution to the home video market, the rights to the song must be renegotiated in order for the song in question to be included on the DVD. Most producers/production companies now include the rights for DVDs or "all media now known or hereafter devised." This assures production companies of the right to re-release without incurring additional licensing fees.
Broadcasting
Broadcasting, in the context of music licensing, means the playback of pre-recorded or live music for groups of people other than the licensed purchaser of a given work, beyond what might be normally expected in a social setting. There has been some legal wrangling over the years about what, exactly, constitutes a 'broadcast' for the purpose of license/copyright enforcement. Legal claims are filed frequently against bookstores, bars, and live music venues that broadcast music without paying for it.
Radio stations pay fees for the rights to broadcast music. Fees are paid to licensing bodies such as Broadcast Music Incorporated (BMI) and the American Society of Composers, Authors, and Publishers (ASCAP) and ACEMLA. Radio stations and businesses typically pay a flat rate once a year, called a blanket license, which can vary based on the amount and nature of music usage. BMI and ASCAP determine how to divide up the licensing profits among copyright owners. Radio stations calculate payment to license holders by periodically auditing the music being played. The audit results are submitted to the licensing relevant body for the station's territory. This information is used to calculate the average number of plays each artist has received.
The music broadcast in grocery shops and elevators is a service which is purchased from one of many organizations that offer it. Part of the fee paid for this service is used to cover licensing costs.
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