Everything You Need To Know About Music Licensing

I’ve spent some time educating you regarding the risks of using the radio as your Message On Hold program, streaming internet radio like Pandora in your store or facility, and including popular music in your online ads. And in general, I just warn you that it’s illegal and can end up costing you big bucks if (when) you get caught. Music licensing has many layers and variations, and can get pretty complicated. But if you know what to look for, it doesn’t have to be.

What is Music licensing, Anyway?

Essentially, a music license is permission to use a specific piece of music. Every license agreement explains how that piece of music can be used. At the core, it’s very simple. The license for a piece of music is basically a contract that states how you can use it, for how long, and in what mediums. But it starts to get complicated, often by technology. For example, you might need one kind of license to perform a song in public, another to play a recording of it, and another to use it in one of your online marketing videos. It might not seem that different, but these intricacies compound quickly.

Music Licensing Basics

The most basic type of license dictates when the work can be used.

Limited Term Licenses set a specific period of time during which the work can be used.
Royalties, on the other hand, are paid based on one sale or use of the work and do not stretch across a time period.

Additional Licensing Considerations

Broadcast Licenses allow you to broadcast a work. They specify the medium via which the work can be shared, such as radio or television broadcasts.
Mechanical Licenses are generally held by music distribution companies, because these companies need to mechanically reproduce a recording for sale (e.g. making many CDs for retailers).
Single Use Licenses allow the license holder to use the music in one particular way, one time, and for nothing else.
Public Performance Licenses are just as they sound – they give permission to publicly perform a work. They can also give permission for that public performance to be broadcast to the public via television, radio, etc.
Sync Licenses require the user to synchronize the music with something else – either another track, voice, or visuals – to use it. So when production music is used in a video production or Message On Hold program, it’s covered under this type of license.
Here’s another consideration – these licenses are generally not transferable from one entity to another. So while a radio station has a broadcast license that allows it to play music, if you play that music in your store or to callers waiting on hold, the station’s license doesn’t apply to you and you can still face legal action.

Creative Commons

Creative commons licensing is a special case, mostly used by people working in creative industries who want their creative property to be shared and used, but only in certain ways. For example, a musician can create a song, post it online, and give it a Creative Commons license with his own specifications. The license can say many different things, but here are some common specifications:

You can use the song for anything
You can use the song for anything except commercial uses
You can alter the song and make derivative works (e.g. add lyrics)
You may not alter the song at all

Creative commons licenses will also specify how the original author must be credited.

But what about music on YouTube?

Interestingly, you’ll see many YouTube videos that feature popular music – without repercussion. Recent examples include parodies of Carly Rae Jepsen’s Call Me Maybe and Psy’s Gangnam Style. For many artists and record labels, the potential for exposure brought by being featured in many videos on YouTube is more beneficial than harmful – because each video has the chance go viral and take the song even farther, for free.

YouTube has a built-in feature that can detect what audio track a video contains and attribute it to the appropriate artist or group when necessary. The artist or group determines if the song can be used and how it should be credited. But be wary – if you don’t fit the artists specifications for use, YouTube will actually remove the audio from the video you upload.

Why Should I Use Licensed Music?

When you use music for your business, it’s important that the music is licensed – with the appropriate kind of license – because using unlicensed music is illegal and can cost you real, actual money…and your reputation. Skip the courtroom and the embarrassment and do the right thing – use legally licensed music for your business.