The Sound of Music 9-1-2000

Meetings & Conventions: The Sound of Music - September 2000 Current Issue
September 2000

The Sound of Music

How to pay for the right to use tunes to enhance a meeting or event

By Terence Baker

The opening session welcomes the crowd with a lively rendition of "La Donna è Mobile" from Giuseppe Verdi’s opera Rigoletto, and Sonny Rollins’ jazz numbers set a low-key tone at break time. Attendees love it, but chances are, the planner is infringing on copyright law. In fact, a manager playing music to set a particular mood at the office is committing the same transgression.

Many planners realize they need to get legal clearance and pay a fee before putting their meetings and events to music. Many, however, do not. But that gap is slowly closing, say sources.

"Fewer meeting planners are playing music without a license," believes Kathleen Merrill, executive vice president for Parker Music Group (www.MusicClearance.com), a Sherman Oaks, Calif.-based company that obtains legal clearance for copyrighted music. One reason: "Publishers and record companies are suing more aggressively anyone using music without proper clearance," she says.

For some who play without paying, ignorance is to blame. One Massachusetts-based planner told M&C that, when organizing his first convention, he gave absolutely no thought to music licensing. "It simply did not occur to me. I was horrified when I learned that my show was not properly licensed."

For others, it’s just not high on the priority list. Jonathan Howe, senior partner at the law firm Howe & Hutton, Ltd., in Chicago, says the music industry has tried to raise planners’ awareness of their obligations. "If you ask meeting planners what they consider to be their own intellectual property, they will then see how important it is to be covered," says Howe. "The issue is one of fairness."

Licensed to bill
To make matters simpler for planners, the three main performing rights societies representing musicians Broadcast Music Inc. (BMI), the American Society of Composers, Authors and Publishers (ASCAP), and SESAC Inc. have created blanket agreements for copyright clearance rather than charging on a song-per-song basis. "Rates vary, but the system is designed to spread the cost of music around," says Jerry Bailey, director of media relations at BMI (www.bmi.com), which, in most cases, charges five cents per registered attendee beyond a minimum annual fee of $100. In other words, for an event with 1,000 attendees, the host organization would pay $500, regardless of how often BMI music was played. If this were the group’s only use of music for the year, it would pay an annual fee of $100, plus $400 at year-end.

ASCAP (www.ascap.com) offers two types of licenses for meeting planners. The first, for those organizing 10 or fewer meetings, exacts a charge for each convention attendee, plus a live music fee. The license for those organizing 10 or more meetings commands a slightly higher fee for each attendee, but there is no extra charge for live music. An advantage of the first type of license is that the meeting planner must submit only one report per year detailing meetings and attendance lists, while the second method requires planners to submit reports quarterly.

In addition, ASCAP’s Music in Business license covers all meetings where only that particular company’s staff are present, as well as events such as holiday parties, telephone hold music and music played in the office above a certain volume.

SESAC (www.sesac.com) takes a different approach, says Bill Lee, director of music licensing operations for the company. "We license the facility for their own use and for that of those using the facility, so quite often the meeting planner does not need additional coverage." In other words, if the facility has a SESAC license, the planner does not need one in order to play SESAC music in that venue.

Muddy waters
Of the three main performing rights societies representing composers and musicians, BMI and ASCAP control almost all copyrighted songs, but it is wise for planners to have coverage with SESAC as well, sources agree. SESAC, which primarily represents gospel artists, also has a handful of big-name clients, including Neil Diamond and Bob Dylan.

Some planners might choose to use the work of only one of the three performing rights societies, but that requires keeping track of who owns the rights to what music and foregoing that "perfect" song for a particular event if it falls under another umbrella organization. Another option is per-song licensing. For those organizing huge trade shows with multiple exhibitors, this certainly is not practical.

In some cases, the onus of securing proper music licensing is passed along to exhibitors. "Exhibitors must provide proof that they have the necessary clearance if they intend to play music," says a planner who organizes conventions and trade shows for toy manufacturers. "This puts the responsibility on the stall holder, which is beneficial to us, as the shows we arrange are so large."

Confused? For events held overseas, the picture gets even more complicated: You need license agreements with the host countries’ performing rights societies as well. However, the United States is one of few countries with more than one performing rights society. Abroad, the chances of having to deal with multiple bodies are unlikely. Nashville-based Laurie Hughes, director of business affairs for ASCAP, says, "In Europe, music rights are protected in a broader manner."

On the road
Hotels and resorts also have their own licenses for the public playing of music. Such licenses might also cover the meeting planner but only in some cases. Meeting planners should check to see what the hotel’s coverage is and whether they need additional coverage for their event.

Another consideration: A trade show or convention organizer might be held liable if exhibitors play music without prior copyright clearance. If the organizer has the necessary coverage for the event, this should not be a problem, and any additional fees often are passed on to exhibitors.

Furthermore, if music is used for promotional campaigns or other pre- or post-show advertising, be sure the organization’s license covers this.

Blanket coverage
Unless a meeting planner needs a specific piece of music for a specific project and intends only to use it once, there is little point in trying to secure clearance for music on a song-per-song basis. Kathleen Merrill explains that in order to be free of copyright obligations, a meeting planner would have to get clearance and permission from several sources.

A song might have one or several composers, plus an owner of the master recording, all of whom must be contacted, says Merrill. If the particular piece of music is a musician’s recording of another artist’s work, the musicians and the composers are likely to be represented by different performing rights societies, complicating matters further. This is where companies such as Parker Music Group come into play, as do the blanket license agreements.

Also, the same song might be represented by more than one performing rights society, depending on geographical location, even within the United States. Each of the three performing rights societies have lists of the songs and artists they represent, so planners can easily find who to contact for proper clearance.

Who checks? A spokesperson for the American Society of Association Executives says, “ASAE understands that the performing rights societies have their own investigators, and they have been known to sue in federal court.” ASAE, together with several other meetings industry groups, recently was involved in negotiations with BMI that saw the minimum rate for BMI licenses reduced from $175 to $100.

The deal lets trade show management companies cover the performing rights fees of clients and exhibitors, thus saving clients the related paperwork. Relying on management firms to oversee music licensing can be an attractive option for smaller associations with limited staff.

SHOULD YOU DOWNLOAD?
Free music at your desktop. The concept has caused much strife in the music industry and was being debated in the courts at press time.

What’s it all about? In a nutshell, MP3s are downloadable, high-quality music files (not to be confused with www.MP3.com, one Web site from which these files can be downloaded. Initially, www.MP3.com approached the major record labels, looking to enter into partnerships to legally provide music across the Internet.)

In June, record labels reached an agreement with www.MP3.com, allowing the dotcom to stay in business in exchange for a one-time payment to the record companies of between $75 million and $100 million.

Napster, another music-download site, claims it merely provides the downloading technology, and those who go to the site are the ones guilty of copyright infringement. Napster and other similar sites place warnings of copyright violation on their Web pages. In May, the rock group Metallica issued a multimillion-dollar writ against Napster and produced a list of more than 300,000 e-mail addresses to which the group’s music was illegally downloaded. Napster’s legal battles are far from over: A judge recently ordered the company to remove links to copyrighted material. Napster has appealed the decision.

The bottom line? For now, at least, there’s no such thing as a free tune.

T.B.

FREE FOR ALL
There is a reason supermarkets and malls play Muzak: It has been cleared of copyright liability by a background music service. Of course, there are rules, including caps on volume level. For details, go to www.muzak.com.