JPF Home Page Forums General Messages Industry Message Forum ASCAP fees for small venues

TrumanCoyote said: "ASCAP licenses are based on the number of seats, the number of days-of-the-week they have entertainment, and the number of musicians who perform. In a typical coffeehouse, I can assure you that the annual ASCAP license fee amounts to less than the cost of one latte per day."

I WISH this were the case. I perform in two small venues that are restaurant-wine bars. My program is all standards (Gershwin, Cole Porter, Hoagy Carmichael,etc.) I work 2.5 hours a week in one place, and only 3 hrs./month at the other. ASCAP slammed them for $1000 and $900/yr. and they want the money NOW. They're putting me out of work. And yes, I'm an ASCAP member (songwriter) but fat lot of good it does me. Part of the problem is that they play CD's, too, so even with only a few hours of live music, they still have to pay a lot to license whatever is on the CD's or tapes.

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I will always disappoint people who expect me to be ordinary.

Dream,

You've kind of addressed your own question. The venue IS using a LOT of music there and has to pay license fees. It's really simple and straight forward. And they are not some little coffee shop if they are selling full menu food and alchohol. Even in that case, their fee of 900 dollars a year is less than a glass of wine a day for unlimited music year round. Sounds like quite a GREAT deal to me. If the music they use doesn't result in an extra glass of wine a day in sales to cover the fee, then they need to play better music or hire better live entertainment. I bet when you perform, you result in FAR more sales than a single glass of wine right? Perhaps they should instead book you more often right? $2.46 a day is a small business fee. How many napkins do they use per day? What does it cost to clean the table cloths? Wash the dishes? How much in daily glass breakage? How much is the electricity? Why is it that everyone ELSE gets paid to provide ambience to the restaurant, but it's unfair for songwriters to get paid? You're on the losing side of this argument Dream. Both in concept and result.

Brian

Brian understands this issue. It is a pity more people don't, and I blame the PROs for that. They should do a better job of educating people about just exactly what Brian explained in the previous post.

Whoa, dude. I'm not on the losing side of any argument. In fact, I agree that ASCAP is doing right by all songwriters by collecting licensing. I'm only saying that, A, it's not a piddly amount when they say, "Give us a thousand dollars right now!" and B, the restaurant owners who have to pay it find it sufficiently stressful that they think they can't afford live music. So it's a problem. I don't understand your "glass of wine a day," I don't think that's an accurate figure. It's certainly something more than that or these proprietors wouldn't be stressing so bad about it. But I never said ASCAP shouldn't collect licensing, I just think that they can be heavy-handed about it and it's not necessary.

I'm a little surprised by the argumentative tone, Brian, but we all can get a little excited about our point of view, so it's OK.

I went to see a local songwriter perform at a "pizza place" last week. They were hit with an $800 bill from ASCAP last week and are shutting down their music. The place seated at most 30 people. House concerts, open mics, and places that seat less than 50 should not be billed, PERIOD, end of discussion. To call this place a dive was being generous, the AC was busted on a 95 degree day, the floor tiles were coming loose, there were only two customers besides me, one of whom was a very talkative drunk. Three PRO's, and you HAVE to pay all three, including SESAC whose billing and collections are seen less frequently than UFO's. If Folk Alliance negotiations on this are not successful, folks SHOULD approach the lobbyists of the National Restaurant association or lobby congress themselves. You DO NOT create a vibrant musical community by taxing places where beginning performers can play out, PERIOD, end of discussion.

Sorry, Pom, but a discussion is not over because you have had your say.

First of all, it is not a tax. If you think so, then you have a profound misunderstanding of the whole issue.

Dream, I'll wager you the cost of that wine bar's ASCAP fee that the $1000 was demanded up front because the venue had REFUSED to pay for the license when originally asked. When a PRO sends a bill to a venue and they take the required license and pay the fee...no problem. BUT, if they refuse to pay, or simply ignore it, and years go by, they are required to pay all the fees in arrears to get caught up. The only venue operators who get stuck with huge, punishing fees are those who think they can get away with stealing music from its rightful owners. They end up paying. As of about 2 years ago (I have not kept up) ASCAP had NEVER(!) lost a court case involving a music license. Their rates have been judged fair by the courts on countless occasions, and people who steal the music are found liable--every time.

A PRO will try to set up a venue based on a monthly fee--a fee that is not at all punishing. As I said, the size of that fee is based upon a bunch of factors including seating capacity, number of nights per week that entertainment is featured, number of musicians used, etc. I think the "glass of wine" analogy is sound. If an ASCAP license is $1000 per year, that equates to less than $3 per day for unlimited use of ASCAP's millions of registered songs. Three bucks a day is, as Brian and I both noted, less than the price of a single glass of wine or a nice latte.

And to answer Pom again, it is NOT the duty or goal of ASCAP to "create a vibrant music community" for beginners. The beginners have that onus on their own shoulders. Always have. ASCAP's duty is to make sure that professional songwriters are faily compensated for the use of their work.

BTW, ASCAP is not a private, for-profit company. It is owned entirely by its members--the songwriters. BMI and SESAC are for-profit businesses who work for a piece of the action in behalf of their members.

[This message has been edited by TrumanCoyote (edited 07-19-2006).]

Well... Great Job!!! Thank you Brian & Truman ... Now I can say I understand this issue... and it makes sense.
thanks
Joanne

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[*]The Best is Yet to Be,Joanne Lurgio-singer/songwriter www.joannelurgio.com


[*] Joanne's Gig Calendar - http://www.musi-cal.com/search?key=performers&value=Lurgio

[*] http://www.soundclick.com/bands/pagemusic.cfm?bandID=100751

[*] www.cdbaby.com/cd/lurgio

[*] MySpace - www.myspace.com/joannelurgio

[*]www.cdbaby.com/group/justplainfolks

Thank you, everybody, for your comments! This is turning into a useful discussion!

The best thing I got from Coyote's last post was the monthly fee; if my clients (venue proprietors) actually CAN pay by the month, that's much more reasonable.

I kind of want to quibble over the figures (guilty! I'm a quibbler!) because I think you're dividing it into 365 days a year. These places are only open and making any money six hours a day at most, six days a week, with holiday closings as well. It's not like they're making money hand over fist 16 hours a day, every day. So per-hour-of-operation, it's somewhat steeper than the glass of wine analogy.

But yes, they DO have to pay the PRO's if they use music, even if it's just CD's or the radio or the busboy whistling while he works; if it's copyrighted popular songs, they must pay.

Which brings me to the crux of the matter: IF the venues pay ASCAP (and BMI if they show up) whatever they are assessed, isn't that for ALL the music used during ALL the hours of operation? If that's the case, the business doesn't save any money by cutting back live music entertainment. So I could perform there more often, without ASCAP charging them more for it. Am I right? This is the crucial question here, for me.

Despite my whining, this is where all this discussion was leading. If anyone can confirm this, it will really help my cause as a performer trying to work in these small venues.

THANKS AGAIN!!!

Interesting. I've been with ASCAP for quite some time and didn't know that. I thought all the PROs were for profit. Must have missed it on their site and paperwork. It's a good thing as far as I can see.

As to the cost of glass of wine or a latte, that is certainly the case. That cost comes out to $2.74 per day. The wine shops around here charge about $4.00 for a glass of wine, depending on the type and the coffee shops charge more for a latte, including Starbucks.


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Miltenberger Homes

I *could* be wrong, but the way I understand it, YES, you're right. It's an "unlimited" license for however many songs (live, or recorded) they want to play throughout the entire year. If they're telling you they can't afford you because of ASCAP, BMI, etc, they are either lying or don't understand their own bill & license.

It would be a little like getting "unlimited long distance" on your phone calling plan and then still fretting over whether it was day or evening hours and how many minutes you used, when you make a long-distance call. It becomes a moot point.

It's possible they *think* the fees are for live music only--in that case they're wrong again. They save money by cutting back live gigs ONLY if they're paying the gigs ;-).

Is it possible ASCAP/BMI etc come nosing around more quickly if there's live music? hm.... maybe they just want to avoid that bill that keeps adding up??

I did some quick calcs a few weeks ago at their websites (don't remember if it was BMI or ASCAP, sorry) on what licensing a website would cost, just running some made-up figures thru their online calculator. The most I came up with "owing" was around $300 a year, which didn't seem bad to me. I'm guessing if the venue's getting hit up for $1000, maybe they've been sneaking by without paying for a while, or something.

Anyway that's how I see it. I'm new at this so I'm prepared to be wrong.

Linda





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Linda Adams
http://www.alyssastory.com

I agree with niteshift. It's not too much to ask. As for the beginning musician, I recommend being creative. Volunteering one's time entertaining at retirement homes and children's hospitals can keep one busy while developing skills. Church gatherings, social clubs, military socials and school functions are wonderful venues for a novice. This way the beginner can be benefitting people who really need it, rather than providing free or cheap services for a commercial venture which further depresses the mean wage for professional musicians.

All the Best,
Mike

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You have to practice improvisation. -Art Tatum

Mike Dunbar Music

[This message has been edited by Mike Dunbar (edited 07-20-2006).]

Without getting into the details - there are exceptions for playing recorded music in a limited size venue and through a limited system that do not require payment, so there is a possibility of playing recorded music legally without paying anything at all. That's thanks to a bill the restaurant owners association managed to get pushed through congress a few years back. There are also separate rate structures the PRO's have based on whether you are using recorded music (called a "mechanical" license by the PRO's) or live music, whether you have a dance floor or not, whether you are charging a cover charge or selling tickets, and the number of nights you have music.

Since the venue will have to pay ASCAP, BMI and SESAC, and doesn't make money 365 days per year, the cost is probably more like two coffees a day rather than one. Minimum size criteria assumes up to a capacity of 100, and yes there probably are a few coffee shop type venues around the country that would close their doors if it cost that much more per day to operate - those probably aren't making a profit as it is.

So if you want to be proactive about it and make sure you keep the venue open you have a couple of options:

1. Contact the PRO's, educate yourself and have a rational discussion with the venue Owner about the actual cost and where the money goes.

2. If they really can't afford it, organize a fundraising show at the venue and use the proceeds to pay the licensing fee.

3. Use the "problem" to promote independent original music by instituting an originals only policy and not performing any tunes that have been registered with a PRO - and make sure the performers stick to it.

Actually, the best thing you can do is to make sure your shows bring in enough people to double the volume of business the venue does and they won't care about how much it costs...



[This message has been edited by Marty Helly (edited 07-20-2006).]

OK! Good discussion! I figured out where the $2.47/day figure comes from! It's $900 divided by 365 days, and like I said, this figure seems palatable if my proprietors could PAY it by the day, or the week, or the month. Both of these places I work are pretty new, so I doubt they should owe any retroactive assessment. So I don't get the demand for a grand up front.

I mean, If ASCAP knew they were using music before now, why didn't they bill them as soon as they found out? Or if they did bill them as soon as they found out, then retroactive fees ought not apply because they would have no proof. But, again, I'm trying to get insight into a process that I have no direct participation in.

It's a bit harsh to call my employers to task for being stingy; these are small, privately owned, new businesses, just trying to find their way. They are also very nice people that I have developed a good working relationship with, based on mutual respect. They are the best gigs I've ever had, a good match for my style, and they weren't easy to find. So I don't see blowing them off and working elsewhere as a viable option for me.

I'm considering offering to take a pay cut at my weekly gig to cover ASCAP. I'd rather do that than lose the gig altogether...

We'll figure it out. Wish me luck. And thanks again for your thoughts.


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I will always disappoint people who expect me to be ordinary.

If I may, I will add a little more insight here:
First, Truman is correct that when a PRO starts requesting amounts in the thousands of dollars it is probably due to the fact that the venue previously ignored warnings to buy a license. When this happens, the PRO usually does it's homework, and establishes a history of infringement for which it can seek punitive damages. The cost of buying a license to begin with is much lower (see below).
However, to say that BMI is a "for-profit" organization is incorrect.
I recommend that people read the case of BMI vs. CLAIRE'S BOUTIQUE 949 F.2d 1482 from the United States Court of Appeals, Seventh Circuit (1991). In that case, it was established as fact that BMI is a non-profit performing rights organization.
It is also interesting to note that in the CLAIRE'S case BMI offered to sell the defendant a license "at an annual cost of $240 for the first location and $45- 60 for each additional location" depending on the size of the location and the volume of sales. The defendant refused, and BMI then sued them for 88 counts of copyright infringement.
Another case that is interesting to read is BMI vs. STAR AMUSEMENTS 44 F.3d 485, also a Seventh Circuit case (1995). In that case the Court found that BMI "negotiates" blanket licensesw which grant the operator of a bar, radio station, etc., the right to play any of the thousands of songs in its stable for a fixed fee. The Court noted that BMI distributes 80% of the money received back to the composers.
In the STAR AMUSEMENTS case, BMI had Field Inspectors who showed up and kept track of the number of BMI songs played without a license (14). BMI then sued the defendant for infringment, and the District Court awarded BMI the maximum statutory damages ($10,000 for each of the 14 "infringing performances") totaling $140,000.
It is much cheaper for the defendant to buy a license. Punitive damages are designed to prevent future infringements of the copyright holder's works, and to encourage venues to buy licenses so they can freely use the music in the first place.

Thanks for that correction and clarification. It's good to know.

Wow, what a lotta kewl information.

I've had a weekly(Sunday) gig at a vegetarian cafe for the last 5&1/2 years. They also have live music every other Saturday afternoon...And they also play CD's non-stop during the rest of the week...Once a year, all the musicians show up & do a marathon concert & the proceeds go to the owners to pay their PRO fees & everyone is happy. I've got my doubts about how ASCAP divies up the money, but that's not my concern. All I know is that once a week I can play any derned song I want & flirt with every pretty girl,,(& a few of the cute guys).

Midnite

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Satchel was right...Something is gaining on me....
www.jackcouldntmakeit.com

If it is imposed by government mandate, through existing laws and court decisions, it IS a tax, even if it goes to goes to composers, less expenses. It IS imposed through law and court decisions, it IS a tax, period, end of discussion.

When RHO or French or whomever, charges a high school a specific fee for staging Camelot or Carousel or whatever, there is specific knowledge that a specific play will be performed.

There is no one collecting moneys for readings of poetry of EE Cummings or the heirs of this or that Poet, the reader knows who will be read, the bookstore does not. They are NOT in business specifically because of the content. It is what is known as a nuisance fee, rather like being charged a rare fish tax because you might catch a fish.

You do NOT hit up a hole in the wall for $800, period end of discussion. Why should restaurants have the luxury of doing Bob Dylan songs because they know that SESAC the reps Mr. Dylan will generally make no efforts to collect (a friend of mine who is an attorney has spoken to SESAC on behalf of a specific place and they as much as acknowledged this), whereas X composer repped by ASCAP will?. Why have nuisance taxes, it just discourages innovation and creativity.In having money collected because you should, you just discourage creativity outlets. I'm just saying that places where music is an afterthought, not like sized venues such as Jammin Java or 930 Club or arenas or festivals, shouldn't be charged a sizable minimum just for having an open mic and a lady playing the guitar on Thursday night.

Joel,

Just because you want something to be true, doesn't mean it is. Period. End of Discussion. = )

The 900 dollar license in question still breaks down to 2.47 a day. If the venue chooses to only use a portion of those days, that's their choice. It's like suggesting you should only have to pay for your cable for the exact hours you watch TV. That's not going to happen. If they aren't open on some days, that's a business decision. If they want to have candles on tables, that's a business decision. If they want to use music to enhance the ambience of their location, that's a business decision. All of those cost money. It's their choice.

To answer Dream's question, if they pay the license, live music and recorded music (as described in your post) would result in the same license and coverage and thus no further fee. If they aren't paying you to play, and you sound as good or better as recorded music, you'd think they'd want you there open to close. Keep in mind that often venues use other excuses to not book people to keep from confrontation or hurting feelings. I've heard the "license" argument used many times by venues who really don't want to book live performers in the first place. Any rational business person would already understand the daily cost of a license and would make a rational decision on whether a business expense produces additional income enough to cover or not. If they decide no more live or recorded music, then their decision is that it doesn't add enough extra money to their business to cover it. Either that or they have little or no clue how to run their own business. I'll let you decide which applies.

In most cases, this is really just a pissing match. Venue wants it free. It's like getting free cable. Once the cable company finds out, they expect you to pay if you've been getting free cable illegally. That often pisses people off too. This is no different. Their ignorance that music should be free is not ASCAP or BMI's or your problem. It is their problem as the infringer. They wouldn't likely use music unless it enhanced their business. They should pay for that use. ASCAP and the PRO's have been given the right/responsibility by the writers they represent to collect their fees. The government set up fees to make them CHEAPER and EASIER for venues and others to use music, not the other way around. There are PLENTY of writers who would LOVE to do away with those statutory rates. But the government intervened to help everyone else BUT the writers use music freely for a reasonable (and some say too low) blanket rate. Joel's rant about a TAX is misguided. That "tax" benefits the venues and other music users far more than songwriters as a cost measure. I am sure that many hit writers would love to price gauge for the use of their popular music.. but the government won't allow them to get market rate. Venues and even guys like Joel should be happy that Statutory rates exist. Otherwise nothing OTHER than the most popular music and artists would EVER get used if venues had to pay for each and every song individually that was played/performed. And the cost of keeping track and paying thousands of different parties would be impossible.

Brian

Brian

Midnite Bob..

58 and a half years?

Now THAT'S a steady gig..!!!!

Jeeeez...and I thought I was old!

Bob (feeling pretty) Young

Bob, you may be feeling young, but you really should use your reading glasses more...

Pom,

It is not a tax. You can use any punctuation you wish, and you can insist on anything you wish, but you are talking about something you do not understand. I understand it, BAW understands it; Stu certainly understands it, but you don't. Live with it.

If I own a shoe store, I have a right to charge for my merchandise. Even though the law backs me up and says that you must pay the price if you want shoes (even if you can't afford shoes), it is still not a tax. If you come in and walk off with a pair of shoes without paying, I will call the cops and you will have to appear in court, where you will be convicted of taking something that does not belong to you. The courts will make you pay restitution, or go to the pokie. It is not a tax. It is called fairness under the law...fair to me because my mechandise is protected, and fair (although unhappy) for you, because you have to pay a just penalty.

The PROs are simply a "song store." They represent the owners of songs, and they collect the fees for their use. This has nothing to do with taxation, no matter what you think. You are wrong. Period.

You are saying that the people who write songs should be forced--by law--to provide their work for free to those who cannot afford it. THAT sounds like a tax to me.

Apologies. I get the point now. Period. End of Discussion. Just trying to stir the pot in my own inimitable way :=)

Thanks again to Brian for trying to answer my questions. Especially to the point: "...if they pay the license, live music and recorded music (as described in your post) would result in the same license and coverage and thus no further fee."

That's what I really wanted to know. I hope this is correct. The venues HAVE to pay or go to dead silence, right? So I may be able to keep my gigs after all...

I don't think it is correct. If a club was playing records, and then decided to add live entertainment to the mix, their license would most likely increase. I am not 100% certain about this regarding all 3 PROs, but I AM 100% certain that at least one of them works this way.

Truman,

That's why I wrote "as described in your post" because he already accounted for the fact that they were being charged for live and recorded music performances. The PRO's have very different operating standards. I had dinner with the VP at BMI last winter and we discussed this point. He's actually the guy in charge of their entire licensing/collections initiatives. He says he's never sued a small coffee shop for dues. EVER. ASCAP, on the other hand, does it fairly often. I can think of dozens of venues in Indianapolis that don't pay PRO fees simply because no one has ever asked them. But someday they will, and when they do, they'll either pay, stop using music or if ASCAP is involved, head to court where they will lose (since ASCAP has a 100% win rate) and pay not only the fees, but also attorney fees in addition. People would understand if a venue was stealing cable and got in trouble for it.. but they often seem to have a problem with understanding the theft of music performance statutory license fees.

Brian

Hey Dream, just want to say I admire your persistence and desire to work this out so you can continue to perform in this place where the people treat you well. Hopefully that means with $$ and respect. You are right, these gigs are hard to come by. So do what you have to. I looked at your profile and can see you are a very creative person, just wanted to wish you success in your pursuits......Sue Lainey

I registered here because I was looking for information on any reforms to the PRO system, which is obviously very broken. And I was compelled to register here and reply to you because of your astounding arrogance, not to mention lack of math skills.

You obviously have never owned or operated a small venue. It's not a question of a latte a day, it's trying to fit not one, but at least TWO bills of $900-$1200 each through a checking account that can't accommodate more than a couple hundred at any given time.

For a 30 or 40 seat coffeehouse to shell out $2000 for two annual licenses (ASCAP & BMI - and it's ALWAYS two) for the right to play CDs means they would need to make, on average, $13,000 in return sales (assuming 15% average net profit EBITDA) per year.

That's $38.00 in daily sales required to produce the profit in order to pay for the licenses. That's not a latte a day, that's nine to 10 lattes a day. Big difference.

Do 10 people walk in and order each and every day because of the recorded music? Maybe, but more likely not.

You are correct in that it is a business decision.

You are also correct in that it is a business decision to choose what hours one is open. However, you conveniently seem to forget that be open also means labor costs and other operating costs.

For most coffeehouses without liquor licenses (and that's most of them), it is not profitable to remain open on weekday and Sunday evenings. It's a strawman argument to suggest that those are viable hours for music performance.

Is it fair to pay musicians for their work? Of course it is. That's not my argument.

Is it fair to pay two organizations roughly the same fees (and three if SESAC decides to come around) when your music selection also includes a fair amount of indie music not licensed by any of the above? No it's not.

However, because the onus is on the establishment to prove what's played and none of the PROs make it easy to figure out who's who, one can't really make a decision to go "only ASCAP" or "only BMI". It's far too cumbersome to do so in order to save $1,000.

In a digital age it should also be completely unnecessary. Even now, I don't understand why I couldn't put an MP3 player into a dock, play exactly what I wanted (d/ls from Napster or other service with embedded DRM), and have micropayments go out to exactly ONLY those artists whose music I played, instead of paying the Rembrandts or K-Fed or Hillary Duff or Fiddy - none of whom I wish to pay a penny to. The technology is certainly there, and it would probably be cheaper in the long run to administrate from the PROs angle - and more profitable for people actively creating good music instead of the artists already rich from whatever deals they get from the big labels.

And while we're against monopolies in most areas, this is one case where it would probably be welcome at the venue level. Why are there three organizations that do essentially the same thing. Why isn't there just one license that could be cheaper because of the greater economies of scale?

Those are just two ways the system is broken.

Regarding other points you've made vis a vis live acts at coffeehouse on other threads I've read here this morning, your arrogance reaches a pinnacle.

You said something to the effect of, "If the music isn't drawing, then management has the wrong music." That's simply bullbleep period.

We no longer book anyone who's traveling through because they don't bring a following with them. As it is, we can't pay much because we can only seat a couple dozen people. Unlike beer, they're not going back for refills of espresso or smoothies - they have one, maybe two, and that's it for the performance. If we charge a cover, then we're hit for a whole other level of billing by the PROs.

Again, we pay $20 (plus free food) for most acts (we'll go a little higher for proven draws). That means we need to do about $120 in sales during the two hour performance JUST TO BREAK EVEN.

Most times all that happens is that we give away our 90%-100% of our profits for that time period. Still, we do music because we like supporting local artists as we believe (unproven) that it supports our brand image. But don't think for a minute it's a moneymaking proposition. Out of a hundred evenings of entertainment, maybe five make us a dime.

To suggest we invest even more in live acts is just silly. We'd do better just leaving the mp3 on.

Try to have some idea of what you're talking about next time you venture into thinking you know how a small business operates.

If this post gets me booted off immediately, so be it. This needed to be said.

I belong to a songwriters association here in Maine and the venue that we use to perform plays nothing but our own originals/members from the association. We are warned by the proprietor that any and every tune played live or from cd belong to our members...this very topic must be the reason why? We always have a full house with plenty of fun and good food..money being spent all night! Is that what we should call Nirvana for a music venue?



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My Sound Click

In a time of universal deceit, speaking truth is a revolutionary act", George Orwell

MySpace

Hello and welcome to JPF----Rwusc!!!

Thank you for your informative and heartfelt post. I think alot of what you said makes sense. I wondered, since you didn't put it on your name, what market of the country you were in (this would give a little perspective). I am sure Brian will come and converse with you himself....I just want you to know that NO ONE EVER gets kicked off the boards for coming and expressing their opinion on matters. That's what this place is all about. I personally know a couple that retired and opened a coffee shop. They went bankrupt after about 8 months!! I do not think it is easy to make a living doing what you do and though it is not great for musicians, I see your perspective. If 10 people have to come and buy something to break even on the music, those aren't great #s for profitability, and the musician at $20 earned is not exactly doing well either.
Every day another article comes out to show how much seems to be worth less and less to most people. Here in Chicago, a jazz singer named Judy Roberts who played at a downtown hotel for 16 years was abruptly told it was her last night by management. They decided to go with nothing. I dunno, it's sad...

Herbie

[This message has been edited by Herbie Gaines (edited 11-20-2006).]

RWUSC,

First and foremost, if you're going to take shots at me or others here, you should have the courage of your convictions and use your real name. When you don't your credibility is already in question before you write a word.

Next, when you're going to make attacks and call me arrogant and without math skills you might consider actually quoting MY words and not attributing other people's words and examples to me to fit your argument. Please indicate a single place on this post where I even used the word "Latte" before this? Please show where I was discussing a small 30 seat coffeehouse?

What I ACTUALLY said was the example given was a larger venue, who served a full menu and alcohol. I used the $ quoted and broke it down to a cost of $2.47 per day. Since you seem to suggest you're brilliant with math and an expert on venues, how about you explain how my example is wrong? The average glass of wine costs about $5.00 at most average restaurants. (Some more, some less.. but that's pretty typical for most decent places). At that price, 1 glass of wine equals app. 3 dollars in profit, give or take a little. Clearly more profit than the needed 2.47 to pay the PRO fee. Are you actually suggesting I am wrong? If so, then you don't know your math or venue prices/costs very well.

Next, you claim the fees for a 30-40 seat coffee house is $2000 a year from ASCAP/BMI. I'd like some actual verifiable proof of that. If you are running a small non-corporately owned coffeehouse that doesn't serve dinner nor serves alcohol and seats only 30 people, then you're getting charged more than any similar venue I am aware of. In fact, BMI rarely (if ever) even charges a fee for tiny venues. This comes directly from Fred Cannon, the VP of BMI who is in charge of their licensing. They also don't litigate against small venues. So, name the venue that fits your scenario that is paying that much and I will personally bring the matter to the person in charge at BMI. If you can't provide a "real" example then your entire rant falls flat. False facts don't make your argument correct or relevant no matter how angry you are.

As for your rant:

"Is it fair to pay two organizations roughly the same fees (and three if SESAC decides to come around) when your music selection also includes a fair amount of indie music not licensed by any of the above? No it's not." -RWUSC

It's entirely fair for them to charge any amount they want and it's entirely fair for you to elect not to utilize the songs they represent. If you had cable and wanted to watch both HBO and Showtime you'd need to pay both entities. If you wanted Cinemax on top of it, you'd have to also pay them. The PRO's have catalogs of material. No one is forcing you to utilize any of the content in their catalogs. That's your business decision. So even though their rates are quite reasonable, it's always up to you to decide whether to use it. As for Indie Artists.. you act as if you're an authority on them. Do you run the largest indie artist community in the world? Didn't think so. I happen to though. And of the 350,000+ songs we got from members for this year's awards alone, over 70% of them were affiliated with either ASCAP, BMI, SESAC or their local PRO to their country (such as SOCAN, PRS etc.). On top of that, even artists who aren't affiliated often perform songs co-written with someone who is and they also will often slip in a cover song at some point that is registered. If you want to just watch 1 show on HBO per month, you still have to pay the fee for the month. Why should music be different? The rates are low and set on a blanket "all you can eat" type of basis. If they allowed for individual song use licenses it would be chaos and WAY more expensive and impossible for venues to keep up with. The PRO's are your friends. You just can't see it.

As for your concern that the money isn't going to the writers whose songs are being performed at the venue, that's a legit concern which we've raised ourselves many times. But keep in mind that writers voluntarily join a PRO and give them the right and responsibility to collect their fees and they agree to the system when they join. It's none of the venue's business or concern about whether the deal the writer signed with the PRO is a good one. To suggest you shouldn't pay the fee because the PRO system doesn't pay fairly would be like you saying you should be able to steal socks from Wal-Mart because Wal-Mart isn't paying the manufacturers enough for the socks you're stealing. It's a completely bogus and flawed argument. If you want to legally use music.. you pay for it. If you don't want to pay for it, regardless of the price, then you don't use it. Even if the licenses were 10 times higher it's STILL the right of those who own the songs to charge. Ironically the government has put a cap on what can be charged with statutory rates and compulsory licenses. If the government hadn't artificially set rates, you'd have to pay a LOT more for music than you do now.

As for your argument that there should only be 1 PRO, though it may be better for you, it's really none of your business who a songwriter contracts to collect their fees. If songwriters want 100 PRO's they have the right to have them. Monopolies are rarely good. Be glad there aren't 10 more to deal with. If the Napkin makers wanted to use 3 collectives to handle their billing, that would be their right as well. Would you rather deal with each songwriter one at a time? If you can't sort out 3 PRO's how would you like to deal with millions of individual songwriters? The PRO's are a great thing for venues who want to use music. They make it simple. If you're small potatoes often you can slide in under the radar and never get a bill from BMI. ASCAP may come around and you may have to pay them. If the bill is too much for your business, don't use music. All that said, billing for both venues and radio will improve as technology improves. But it's still a long way off. SoundExchange already does what you suggest for Internet Broadcast Performance royalties (something you don't have to pay now but WOULD have to pay if everything goes over the Internet as you want). But they are a tiny blip on the radar right now and can't even get artists to take the money that is sitting there for them. But that's another discussion.

As for your comments that you don't book people "coming through" I think that is short sighted. If your venue is known for presenting outstanding acts every single night, then many of your customers who like great music will come regardless of who is there. If you book acts with interesting stories (award winners, TV placements, Movie soundtracks, etc..) then you can build interest for specific shows even without a built in fan base to reach even more people. Is that too much work for you? Perhaps. But there are plenty of venues who are great at booking great acts with or without built in fans and who benefit from that. Those that book local acts who may or may not be any good simply because they'll bring family/friends aren't really professional presenters. There's nothing wrong with that, but the better quality the presentation, the more likely people will come. If you just book bad acts with 10 friends then you'll never be known as a place to see great music and thus you probably shouldn't bother if the licenses are cost prohibitive. It's no different than any other business decision. If you do it well, you'll benefit. If you do it half assed, you probably won't.

As for this:

"Try to have some idea of what you're talking about next time you venture into thinking you know how a small business operates." -RWUSC

You might want to point some of that chip on your shoulder anger towards your own misquotes and false attributions. Everything I said was accurate and still stands correct. You changed the venue type and the product I mentioned and then ranted on and on about things I never even said. You quoted very high licensing rates for a small venue but don't explain where that venue is or even give the state you live in. It's ironic for you to rant about me not knowing how a small business runs while at the same time pretending you know something about the music industry. Which area do you actually work in?

And finally, your paranoia about being deleted is just as misinformed as the rest of your rant. But then, that seems to be your MO so far. But that's okay.. we welcome you anyway. Everyone has to learn somewhere. Perhaps you'll open your mind a bit and learn the truth behind your rant.

Welcome to the group,

Brian

[This message has been edited by Brian Austin Whitney (edited 11-22-2006).]

According to the BMI license worksheet for Eating and Drinking Establishments, a 30-seat venue that has a solo performer 2-4 nights/week, and uses CDs and radio for background music -- no dancing, no TV, no karaoke, etc. -- owes BMI $229.50/year. I'm guessing that the ASCAP fee is in the same neighborhood.

Anyone can do the calculations here:

http://bmi.com/licensing/forms/ede.pdf

------------------
Scott Andrew
Lo-fi acoustic pop superhero!
http://www.scottandrew.com/music

Scott,

Thanks for shedding some facts on the situation. I noticed that the original "anonymous" poster didn't have the integrity to respond to my offer to intercede on his behalf with BMI. Obviously that is because he was either lying or clueless. I am guessing it was some of both.

Brian

I'm curious about something. I have read that you must pay ASCAP if you play music, even if you only play original material from artists who are not members of ASCAP. Is this true?

If so, can an endless number of PROs (ASCAP, BMI, SESAC, and potentially others) hit you up? What would prevent 100 such organizations from billing you $1000 a year?

And if you can limit payments to just one, couldn't DIY artists create a new PRO that allows their music to be played at small venues without demanding a fee? Seems like that would be an opportunity for indie artists and live music venues to promote each other.

ASCAP can only collect performance fees for the songs for which they are authorized to collect.

The thing is, most songwriters have their songs registered with some PRO, so if it's not ASCAP, it's BMI. Or SESAC. Or SOCAN or APRA, etc.

Running a PRO is a complicated, costly job. That's why there's only a few major ones instead of thousands.

An indie fee-free PRO is a nice idea, but it would have to be a labor of love, since there'd be no money coming it to support it



------------------
Scott Andrew
Lo-fi acoustic pop superhero!
http://www.scottandrew.com/music

Suzanne,

If you want to do the work to verify 100% of the songs are not registered with any PRO, then yes, you can go without paying the fees. If EVER one single song from one of the PRO's is performed or played in the venue, then you're liable for the fee and if you refused to pay, damages, court costs etc. The fee is very low and was set up to HELP venues, not harm them. By paying a blanket license, you get to use music as much as you want without worrying about infringing or keeping track of anything. If you wanted to negotiate those fees 1 song and 1 writer at a time year round just the keeping track part alone would cost far more in labor time than the cost of the license for most people.. and again, that assumes you can 100% verify that none of the songs have any writers registered with a PRO. That's very rare and hard to find or achieve. The fees, as discussed here, are very low. On top of that, shouldn't the venue want the indie artists who are unaffiliated with a PRO to be compensated for their work as well? Technically they could go directly to you and ask to be compensated. I am not sure you'd get out of that responsibility just because they aren't with a PRO if they wanted to be paid.

Anyone here know the answer to that one? Would an Indie artist who isn't affiliated with a PRO still have the ability to bill a venue for playing their songs directly?

Brian

In the first place a $5 glass of wine doesn't have a $3 profit more like a 20 cent profit. So that comes out to more like 2300 extra glasses of wine to pay for a $229 fee twice.

In the second place in this country you don't have to prove your innocence they should have to prove your guilt. Give a list of EVERY song you played that was in their catalog and you should only pay for those. Until they can produce those kind of list ( coffee shop A played "Summertime" twice on Jan 1 at 9:53 etc.) I don't see that the PROs have any moral standing.

Remember if a lawyer can't make at least $5000 on the deal it's not illegal.

Hey Doug,

You're not a member of a PRO then ? Are you a songwriter ? Just wondering.

cheers, niteshift

Doug,

That you need to take up with the US Government who backs up the blanket license by law. You see, songwriters have NO CHOICE to but allow ANYONE to perform their songs ANYWHERE. In exchange for that priveledge, venues have to pay licensing fees if they have live music. No one forces them to do it.

As for your suggestion that they have to prove that licensed music was used, in court they DO have to. And the PRO's have never once lost a case in court and aren't likely to start losing any time soon.

And what nightclub are you running that only makes 20 cents on a glass of wine? Seriously.. how could they stay in business if they were that stupid? The rule of thumb is that any bottle of wine is sold for double or more automatically and the cost of a glass of wine is more expensive than buying a whole bottle. If you know venues who don't mark up their wine even 10% then you need to give them a crash course in common sense and business 101.

Brian

Doug,

Was going to comment, but Brian's pretty much summed it up.

Question ? - should all businesses who broadcast to the general public not have to pay licensing fees ? And that is what we are talking about here, public broadcast.

If you play my material in public, and you profit from the business situation, you are making money from my hard work. Do you pay staff ? , do you pay rent ? , do you pay utilities ? , but you are not willing to pay for my work which entertains your patrons ? Hmm.......

And this is coming from a bloke whose family were hoteliers and always paid their dues. It's a business overhead, treat it as such and be fair to the poor ( And I mean POOR ) musicians who entertain your patrons.

cheers, niteshift

If you are selling wine for $5 the cost of the wine is $2.50 the cost of the over head is $2.30. Anyone who thinks the markup is the profit has never run a small business.

And I have owned and run small businesses off and on for the last 40+ yrs. BTW I am a songwriter and I do have copyrighted songs. If the PROs are not loosing in court then there is something wrong with the jury. Some where they missed the part of innocent till proven guilty. If I'm on a jury and you can't show me proof of X performing Y's song then the PRO's loose.

The PRO's are killing the goose.

Hey Doug,

Proof is simple, just take your camcorder into the bar with a legit timecode on it, there's your proof.If you are playing unlicenced music in your venue to the general public, you're guilty mate.

Perhaps the national broardcsters should stop paying their dues.Why do they pay them ? Because it's fair and reasonable. It's part of their business overheads, they don't complain, why should you ? Guess that's the difference between people who act in a professional manner, and those that try to scam from poor musicians.

I can't believe a bar owner, who supposidly is also a songwriter can take that point of view. Beats me !

Guess you're not really a songwriter ?

cheers, niteshift

PS - play one of my songs in your unliceced venue, and I would welcome the court challange.

Doug,

So you're suggesting the wine glass sales must bear the brunt of all venue expenses? Are you serious?

So.. are you telling me that if someone comes in to watch a band because there is a live music performance and by doing so, they buy a glass of wine for 5 dollars which results in 3 dollar profit (most real world wine glass sales are 60%+ profit) that because that person is there, it costs an additional 2.40 to serve them than it would have cost if they had not bought that glass of wine? If you ran a small venue that sold wine and had live music you'd know better. That's an EXTRA sale and thus the profit is real. It may go to your OTHER expenses, but without that extra glass of wine sold, the venue would have LOST that 3 dollars off their profit margin. The same staff has to be there. The same light bill. The same rent. The same cost of food. The same everything. The point of the entire discussion is that any decent artists should provide extra sales which means EXTRA profit to pay the OTHER bills. If you don't understand the obviousness of that point you better never try to run a small venue.

Brian

Yeah but they are not doing that, they are claiming you are with no proof.


Most broadcasters now have gone to per drop fees, (pay for each song rather than a flat fee).

That's not profit that's markup.

And because that guy came in and got that wine the bar now has an extra 20 cents. True the overhead is the same but he's only making it on the total of all those 20 cents.

Doug,

Aside from the fact that you're wrong, you are missing the entire point of the discussion so let's get it back on track.

1. The fees are mandatory and backed by law. If a venue using live music isn't paying it, they are already violating the law. The PRO's are simply 3 collection services for fees that must be paid by government mandate. If they haven't gotten around to collecting it in the past, it doesn't mean it isn't owed.

2. The PRO's DO have proof before they go to court. And they provide it and they ALWAYS win. 100% of the time they win in court. What is it about that you don't understand? They have proof. You don't win 100% of the time without proof. You couldn't bribe enough juries to do it. If at ANY time someone performs a single song in the venue that is in a particular PRO catalog, the argument is over and they owe the fee.

3. The laws that allow venues to use music for blanket rates are GOOD for the venus. If you had to individually negotiate a license for each and every song 1 at a time, it would cost 100 times as much and many writers wouldn't grant permission in the first place.

4. If the fee breaks down to less than 3 dollars a day, all you need to do to pay that fee is bring in an extra 3 dollars of Profit to cover it. If my cost of running a venue is 200 dollars a day and I normally bring in 600 dollars of wine bottle sales with a 50% markup, I have 100 dollars of profit for the day. If 1 person buys 1 extra "glass" of wine for 5 dollars (typically a 60% markup or more), my sales go up to $605 dollars and my daily cost goes up to 202 dollars (the extra 2 dollars being the cost of the wine) and my profit goes up to 103 dollars (the extra 3 dollars of profit coming from the glass of wine). That's a simple fact no matter how much you don't want it to be true. If a venue isn't producing 3 dollars of extra profit a day with live music, then they shouldn't USE live music. It's not a good business decision in the first place. OR, they aren't hiring the right musicians who can keep people in their seats longer and buying more food and drinks.

Whine all you want, but you're on the losing side legally, morally and logically.

Brian

Oh, I guarantee that's exactly what they do, because I've seen it first-hand, at my own shows. They bring webcams and laptops. They spend several weeks staking out the venue to ensure they have a nice folder of evidence before they actually approach the venue.

Blanket rates are not good for writers, venues or performers only of the PROs. Every song should be listed and the money to the writer.

Has anyone ever performed my song in a venue. Yep I've been in the audience. Did I ever get a cent from a PRO, nope not one. That in itself proves the system is broke.

The problem isn't paying the writers, the problem is that the writers are not getting paid. The system doesn't promote more music it stifles music. The choice is 1000 people making a million dollars and a million people making nothing or a million people making a 1000 dollars.

"Has anyone ever performed my song in a venue. Yep I've been in the audience. Did I ever get a cent from a PRO, nope not one. That in itself proves the system is broke."

Doug - are you even a member of a PRO? If you haven't taken the time to register your songs with one of them and they don't pay you, it ain't the system's fault.

Doug,

I read you criticizing an imperfect system, but I'm not sure what you are advocating.

Do you want to abolish PRO's? How then do you suggest songwriters get paid for public performance of their work? Who, other than some type of PRO, would do this and how would they be able to perform such an immense task as to pay each songwriter for each song used all over the U.S. in one day?

If you are advocating for a venue to be excused from their duty to pay a PRO by paying the songwriter directly, who, then, would be responsible if the singer/songwriter just went ahead and performed someone else's song? Or if the singer/songwriter was plagiarising?

Or are you simply advocating the free use of intellectual property?

The system is imperfect because of the enormity of the task, not because the PROs are trying to screw the little guy. Don't you think the PRO managers, if they could, wouldn't love to get every songwriter/member a check for a buck or three every week with an accounting of where their song was performed? Songwriters would be flocking to join up. No, the PROs aren't trying to screw the little guy, they're trying to get venues to pay for the privilege of using intellectual property, then trying to distribute this money as fairly as the enormity of the task and the limitation of the technology allows. And, if the technology gets to the point where they CAN distribute more fairly, songwriters had better hope we haven't taken the teeth out of the laws in place already in their favor. It would be a much bigger hill to climb.

I've seen and heard arguments about this for a few decades now. It seems to me that it mostly affects the music business at the entry level or at the amateur level. Singer/songwriters aren't usually as upset by the fact that they don't get the ten cents or whatever from their song being played...they're more concerned that they just have a place to play...so they panic when the club says it's closing down music because of the PRO fee. And the clubs? Heck if they were paying the musicians $50 apiece a night, that PRO fee wouldn't even be a drop in the bucket...just have two weeks with no music and that would cover the cost of the fees. Of course, if clubs had to pay $50 a night per musician, then the singer/songwriters would be up in arms against it ("The venues can't afford it! We have no place to play! It's too big a burden!")

The arts are funny, artists will screw each other in a heartbeat to get a free gig.

Anyway, you don't have to answer me, Doug, I don't expect to change your mind, just expressing my views. Meanwhile, thanks for posting and expressing yours. It makes for good spirited debate and good reading. That's what JPF thrives on.

All the Best,
Mike

If you're with SESAC you merely have to show proof to them that you played or your songs got played. Presto, you get paid.