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Music Businesses

Restaurants, Bars Say They're Getting Squeezed by Rising Music Licensing Costs (bloomberg.com) 157

Restaurants and bars face mounting financial pressure from music licensing fees as the number of Performing Rights Organizations has expanded from three dominant players to at least six nationwide. The National Restaurant Association reports members pay an average of $4,500 annually for music licenses, representing 0.5% of total sales for small establishments. Hotels have experienced even steeper increases, with one major chain seeing costs rise 200% from 2021-2025, and some properties facing 400% jumps.

The proliferation stems from streaming's revenue surge, which attracted new PROs seeking market share. Since many songs involve multiple songwriters affiliated with different organizations, venues must secure licenses from each PRO or risk lawsuits carrying penalties up to $150,000 per infringement.

Restaurants, Bars Say They're Getting Squeezed by Rising Music Licensing Costs

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  • by MobileTatsu-NJG ( 946591 ) on Wednesday July 09, 2025 @12:08PM (#65507456)

    I can only speak for myself... but (with a few exceptions, like live performances) I'd actually prefer NO MUSIC at these establishments.

  • by MachineShedFred ( 621896 ) on Wednesday July 09, 2025 @12:08PM (#65507458) Journal

    It's really simple - people want to be paid for their work. If you can't afford it all of a sudden, then stop playing licensed works.

    If these licensors start seeing revenues falling from people cancelling over price hikes, they'll either get the message and knock it off, or watch revenue sink.

    • Re: (Score:2, Insightful)

      by dbialac ( 320955 )
      It comes down to everyone is getting squeezed everywhere. Wall Street wants more profits and the easiest way to increase profits is to raise prices. Meanwhile, anybody who doesn't have a vast stock portfolio or isn't in private equity is getting screwed. This kind of activity is why we need to bring back taxes on the wealthy. Most of that income doesn't do squat for anybody, including the one holding the money. Also, you can't make money when you're squeezing the poor and middle class to the point that they
    • by The-Ixian ( 168184 ) on Wednesday July 09, 2025 @12:27PM (#65507542)

      Maybe they should switch to purely AI generated music. It's not like people are actually listening anyway, it's just there for ambiance.

    • by St.Creed ( 853824 ) on Wednesday July 09, 2025 @12:29PM (#65507550)

      They were getting paid, but they saw opportunities for more extraction of value without doing additional work. Its the definition of rentseeking. Its also not something that's in the public interest - the work was created already, the artists presumably paid. If they weren't, maybe they should learn to negotiate. But this is just extortion.

      The only thing left is to find one of them using the slogan "that's a nice establishment you've got. Wouldn't want a nasty lawsuit to happen, now would you?"

      It works not because there are underpaid people, but because music license are so convoluted that it's impossible to risk it.

      A few years from now you may have 20 organisations, because it seems like free money. And I bet that none of the artists will get paid any better than they are today.

      • How is it extortion if the product is completely optional?

        Who goes to a bar / restaurant / hotel to listen to the recorded music? You go there for drinks / meals / a bed to sleep in.

        If the price is too hard to swallow, find a different provider or turn it off.

        • by tragedy ( 27079 ) on Wednesday July 09, 2025 @06:09PM (#65508476)

          How is it extortion if the product is completely optional?

          I think that was addressed with this part:

          It works not because there are underpaid people, but because music license are so convoluted that it's impossible to risk it.

          Basically, we have a system where, without having a licensing agreement, the damages can technically be astronomical if, for example, one of your employees at your restaurant turns on the radio one day. Maybe even if a customer plays music out loud. Basically, if a "public performance" can get pinned on your business, it could potentially go bankrupt. Will it really? Probably not. Probably you could get out of it through some form of settlement, but the threat is there.

    • by znrt ( 2424692 ) on Wednesday July 09, 2025 @12:39PM (#65507590)

      It's really simple - people want to be paid for their work.

      from tfa:

      The proliferation stems from streaming's revenue surge, which attracted new PROs seeking market share. (...) venues must secure licenses from each PRO or risk lawsuits carrying penalties up to $150,000 per infringement.

      i'm not really sure whose "work" is being paid for exactly here. "creator's livelihood" was a good talking point for ip law strenghtening and the emergence of these collection agencies a couple decades ago, now that they have become mostly tools for censorship, lawfare, monopolies and wholesale extraction while most creators still barely subsist on a few crumbs (who would have thunk!) i don't think they hold that much weigh anymore ...

      • by machineghost ( 622031 ) on Wednesday July 09, 2025 @01:23PM (#65507772)

        Yeah, it's like believing Disney when they changed the copyright law to make copyrights last (nearly) forever.

        On some level, yes, if an author's book is worth $X, then in theory if you extend the copyright on it, it will now be worth $X + $Y. If you just stop thinking right there, you think "copyrights are good for authors" and side with Disney.

        But when you look at the reality, the vast vast majority of authors will never see a single extra penny from the copyright extension. It's only the Disneys of the world that benefit, and they do so at a cost of stifling creativity for everyone else.

        Same deal here: I guarantee you 99%+ of music artists are not making any more money as a result of these deals.

    • The IP owners have mainly been bought by holding companies. Holding companies don't give a shit about supply and demand. They will raise prices, fewer people will buy their stuff, then hike prices again on the remaining customers exponentially.

      It isn't about supply and demand... it is about short term propping stock up.

      • The IP owners have mainly been bought by holding companies. Holding companies don't give a shit about supply and demand. They will raise prices, fewer people will buy their stuff, then hike prices again on the remaining customers exponentially.

        It isn't about supply and demand... it is about short term propping stock up.

        IP owners in the music business are in on the same path as the MPAA. Essentially, squeeze the customers until it starts to impact profits, then whine and gnash their teeth about piracy affecting profits while raising prices again claiming they have to to combat piracy. Go-to-1, repeat until nobody wants to pay any of them. Gee, I wonder why nobody wants to support the arts anymore? Maybe the arts weren't supposed to be turned into a profit-first industry?

    • I too want to be paid in perpetuity for work I did in the past. Sadly my lawyers aren't as well-connected as the entertainment industries'.

      • If I could get a $0.001 for every time a person uses a toilet that I have cleaned multiplied by the number of times that I have cleaned it I wouldn't be a janitor anymore.

    • by keltor ( 99721 ) *
      Except in most cases the Artists are getting paid little to nothing.

      The system for handling this is completely broken.
    • by snarkasaurus ( 627205 ) on Wednesday July 09, 2025 @01:21PM (#65507758)

      On the one hand, yes, people must be paid for their work.

      But on the other hand, the people who actually -did- the work in this case are not the ones setting the price, and they are not the ones getting the money. Music creators don't see a nickle of licensing, most of the time.

      If an Applebees in Podunk Nebraska plays a Hendrix song, does his estate or his heirs get the money? Or is it some conglomerate that acquired the rights in a hostile takeover 20 years ago? Yep, the conglomerate.

      And a quick reminder, the owner of the Podunk Applebees is not the one who ultimately pays for that license fee. YOU are. Because costs are passed on to the customer.

      Thus we have a situation where people are being gouged for license fees and the musicians are still getting nothing.

      Things are never as easy as one might hope.

    • If the music industry actually paid people for their work. But that's so rare I find your comment disingenuous.

      The licenseers have a practical Monopoly because of how music gets out to the public. Radio stations are owned by a handful of billionaires and Spotify is a de facto Monopoly with a laundry list of anti-competitive practices that prevent anyone from competing with them.

      Restaurants need music for multiple reasons. Music contributes to an atmosphere of fun and parties which makes it much more
    • The issue they're talking about here has to do with artists affiliated with multiple rights-holders, causing a big increase in costs to stay legal, trying to play their music in an establishment.

      I'm no expert on this, but I did play in a local band once and got a taste of the music licensing "scene". Bars and other smaller venues NEVER liked paying these rights-holders, because the entire thing felt like little more than a money-grab. It's one thing if you set up a digital jukebox at your bar that makes th

    • by flink ( 18449 )

      Copyright should last like 5 years. Then there would be plenty of public domain music to play.

    • It's really simple - people want to be paid forever for their work they recorded once .

      FTFY

  • Fill this niche (Score:5, Interesting)

    by paiute ( 550198 ) on Wednesday July 09, 2025 @12:09PM (#65507462)
    Sounds like we need a new streaming service which only streams songs which are in the public domain.
    • They will probably start using computer generated music with minimal licensing fees.
      • They already do, and they don't even know they're doing it. Two local Thai and Chinese places both play the same Spotify playlist of AI-generated garbage. They did not know until I told them, can't tell, and don't care if it's AI crap or not. They have to hear it all day, so they mentally tune it out. That is probably causing them brain damage in some way, but so does tuning out shitty background music that's human generated. I hear a lot of AI generated covers of popular songs in different styles. Elevato

    • only streams songs which are in the public domain.

      Music recorded over 100 years ago? More likely will be an AI generator for what we used to call "elevator music".

    • Sounds like we need a new streaming service which only streams songs which are in the public domain.

      I think you meant recordings that are in the public domain. If I get an orchestra together and record the 1812 Overture that recording is covered by copyright even if the music itself isn't. That may be pedantic but I can easily imagine some startup being stung trying something like this.

    • I don't know about the rest of the world but in America it takes over a hundred years for music to go into the public domain. You might be able to find little tiny Indies but the production values are going to be the relatively low and so the music isn't going to sound right when played over restaurants speakers. If you had a punk bar that might work but for anybody else they're stuck and that's why the music industry can crank up prices.

      Big data and a complete lack of antitrust law enforcement means la
    • by flink ( 18449 )

      Sounds like we need a new streaming service which only streams songs which are in the public domain.

      There are commercial services that you can subscribe to that include a license to play the music in public. You only need to be paying ASCAP, BMI etc directly if you are just playing from a Spotify playlist or MP3 server or something.

    • by GuB-42 ( 2483988 )

      Public domain is going to be a problem considering the quality of recordings before 1930. There is plenty of music composed before 1930, but if you are using a recent recording, the performer still has copyright.

      But there are already companies that sell cheap subscriptions (in the order of $10/month) for music that is not covered by performance rights organizations and that you can play in bars and restaurants. Maybe acceptable for background music, but definitely not the same quality and recognition as mai

  • Just put in a jukebox and be done with it.

    • Re: "put in a jukebox"

      There used to be Jukebox inspectors to make sure everything was legal. If enough turn back to that, it would probably become a thing again.

      But there is something fun and nostalgic about jukeboxes in that customers can select the tunes played, and they have colorful glowey shit on them. One problem is that coins aren't worth much anymore, and bill or credit card interfaces would be awkward.

      AI-generated music may become a thing if hits charge too much. If it's merely background "mood" mu

      • Out in the hinterlands of Seattle they started to switch to internet connected Jukeboxs about a decade ago.
        I found that out after I had put my money in and the tunes I selected began playing then other songs were interspersed with mine.
        A person informed me that people could use an app to pay/play songs and for a small premium they could get preference on what the next song would be.

        • by Pascoea ( 968200 )

          Yes, the "play next" feature in TouchTunes is dumb. It's not just limited to the app, you have the same feature available standing at the machine too. It's happened quite a few times where I'd queue up a few songs, then sit there for an hour while someone else is throwing crap in front of them. Just send a crabby message to TouchTunes, they'll refund the plays at least.

          I do enjoy "music sniping" people with the app though. Wait till there's a pause in the music and someone walks up to the jukebox to p

          • by skam240 ( 789197 )

            You can use the app to sneak in some annoying song, or just something that doesn't "fit" with the establishment or person that was just up there, before they get their selections in. You can occasionally overhear a pretty good "I can't believe you played this crap" type of reaction when they get back to their table. (Yes, I know. Stupid. But hey, simple pleasures in life.)

            Oh good, so everyone in the bar has to listen to music you purposely picked out to be shitty and not blend well for the bar's patrons. You sound more like a dick then a funny man.

            • by Pascoea ( 968200 )
              Lol. So I take it you've never been to a bar with a jukebox before? "I wonder if everyone will like this song" has never entered the conscious decision making process for a single song ever picked on a jukebox. My taste in music doesn't match yours, you can probably deal with it for 3 minutes. Maybe there's a song featuring tiny violins I can play for you?
              • After listening to over an hour of some drunks "music" on the jukebox that even the bartender was grimacing at I decided I would leave so I put "Sink The Bismark" on to play 3 times in a row on my way out the door.
                I can still hear it in the distance.

              • by skam240 ( 789197 )

                The fact that everyone has their own tastes does nothing to change the fact that purposely doing something to annoy others is being a dick.

                It's the consciously choosing to do something for the explicit reason of annoying others part that makes you a dick..

      • Your notions are quite outdated. Look at Touchtunes.

        I have extensive experience in the business but I won't talk about it on Slashdot.
        • If a jukebox has tap-to-pay or accepts bills, I play songs. If it requires an app download to play music? Hard pass.
    • by skam240 ( 789197 )

      I guess the fact that people pay into the jukebox helps cover the cost of the licensing. Then you have to deal with people with awful taste in music choosing what's being played in your restaurant unless the owner wants to spend eons setting permissions for bands and songs though.

    • You are still supposed to pay the PRO's licensing fees even if it's just a jukebox. IMO - PRO's have long been an extortion racket and RICO charges should be brought.

  • by registrations_suck ( 1075251 ) on Wednesday July 09, 2025 @12:17PM (#65507490)

    Most of you fuckers play that shit WAY TOO LOUDLY anyway! Just rid of it so we can have a conversation at our table.

    • You're right about that. Plus it seems like all new construction is a concrete floor with a steel ceiling with no sound deadening. Just loud terrible acoustics all over.

  • How does this affect customers who use SiriusXM for Business?

    Regular, private SiriusXM customers have to pay around $15-$25 per year for music licensing fees.

  • I don't know why these establishments would spend a cent on mood music anymore.

  • by gurps_npc ( 621217 ) on Wednesday July 09, 2025 @12:23PM (#65507526) Homepage

    Yes, I know that 4,500 annually is a lot less than hiring a live musician, but:

    1) Don't complain about how your attempt to avoid paying technology to do something much cheaper than a person is now costing your more money.

    2) For a chain with say 100 hotels/bars, it is not unreasonable to hire 3 groups of live musicians for 8 hour shifts and broadcast it live at all locations.

    • Yes, I know that 4,500 annually is a lot less than hiring a live musician, but:

      .. venues still need to pay PROs for live performances: the songwriters still need to be paid. And, even if the artist claims to perform only self-written music, the PROs will attempt to find a bar or two that can be heard in some commercially licensed music.

  • because the operation no pay their music license dues. Uh Uh UHG! Next verse same as the first. (every hit song these days needs a little plaragism).
    • by HiThere ( 15173 )

      Every decent song has ALWAYS been full of plagiarism. Liszt copied music from the Gypsies. Irish Bards used to be *forbidden* (by their guild) to create new tunes. They were only allowed to set new words to old tunes. Copyright law is an abomination in the realm of music. (In some other places I'd argue that it was just too long, but in music it just shouldn't exist at all.)

  • The owners of bars and restaurants should think of it as supporting real people who can go and spend money at their establishment.
  • 0,5% of sales is not a lot. If you (and your customers) don't, just pay some AI-generated slop
    • You're right, 0.5% is not. But if you add X% for local sales tax, Y% for State Sales Tax, Z% for State and Fed Income Tax, etc., those small percentages start to really add up.

  • Stop complaining and reinvent yourselves!

  • Frankly I'm surprised they haven't already. I mean it's already basically just background noise to almost everybody. There's not a hell of a lot of people that listen to music for the sake of listening to music. Yeah elevator music doesn't work but AI can make extremely convincing renditions.
  • When it's quiet we can talk and hear each other in a restaurant. That's how I like it. Someone found that playing loud music and loud colours helped make it a hostile environment and people eat quicker and leave faster. The big question for the operators is, is the music cost worth it?

    If you're going to penny pinch and make it awful, you can do the maths.

    In a pub though, I quite like live local bands, so long as they're not too loud of course. Open mic nights are great. Give me something new and interesting

  • Greed will kill their revenue as users shift to public domain music and AI Tracks.

    They never learn.

  • It's way too loud to have a conversation anyway
  • First of all, the amount of money that gets back to the creator is vanishingly small compared to what's kept by the cartel. While you think you're supporting the creators when you pay your license, you're really just supporting a vast army of middlemen leaching the money out. I'll say that to the apologists in this thread.

    Secondly, they'll hit you up for a license even if you're just playing over the air radio. A radio station that's already paid a license and is playing advertising to pay for it.

  • rent seeking (Score:5, Informative)

    by marcle ( 1575627 ) on Wednesday July 09, 2025 @01:32PM (#65507796)

    Everybody wants to be a middleman. That's where the profit is. You don't have the hassle of creating something, you don't have the hassle of selling something. You just sit in the middle and collect rent.

    Of course it's totally reasonable to expect a commercial establishment to pay for entertainment. But the proliferation of 'rights organizations' along with the farce of naming 20 songwriters on a hit recording that's a 1-chord riff, aren't doing a thing for the working musician. The ultimate outcome will be less music in public, less exposure for artists, and bigger profits for those who sit on top of the music industry food chain.

    This is just the private credit playbook, played out in the music industry.

  • Apps like Wotja can create live ambient music on-device—no streaming fees, no copyright issues.

  • Of the money raised it goes to two sorts of artistes:
    * The composer of the music and the lyricist (ir there are words)
    * The performers, ie band/orchestra and singer
    Of the money taken from the venue where the music is played, how much goes to the artistes above ?

  • There was a music club where I live. The owner was in a band, and into the local music scene. He bought a place where musicians could come to play. That didn't pay the bills, so he got a liquor license. Booze helps paying the bills. Then a food license. Food is good, people like food. Then, someone brought in a Sirius/XM receiver for music during the day. It wasn't a featured attraction, it was just background music. Some BMI/ASCAP undercover agent showed up and billed him for a performance license. Then, l
    • Yep, being an ASCAP member and receiving checks for every time someone plays my music, can confirm. It's been a while since I made any real dance tracks but they still get played and I still get payed as it should be.
      Clubs make a lot of money charging per head to let people in. If you took away the music completely, they wouldn't have a business. They used to hire big bands and have guest singers or put on variety shows with girls dancing the can-can and stuff like that, but that's been replaced by the DJs.

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