If you head into your local hipster coffee shop, you’ll probably see a barista with a handlebar mustache serving cold brew to a pink-haired college student while a soft indie selection plays in the background. Everything looks and feels normal for this type of place, except something is amiss. While you’re standing there soaking in the caffeine fumes and the “ooohs” and “aaahs” from the ceiling speakers, you’re most likely bearing witness to theft.
According to a recent study from music licensing service Soundtrack Your Brand, and Nielsen Music, many businesses like your local hipster coffee shop play an estimated $2.6 billion worth of improperly licensed music.
The study states that when music is played within a business setting, artists — no matter how big or small within the industry — are supposed to be fairly compensated via business music streaming licenses. Unfortunately, most small businesses use personal streaming licenses (think Spotify or Apple Music), and therefore money is withheld from the artists.
Out of the 5,000 small business owners interviewed across seven countries, only 17% of business owners use music services meant for businesses. The other 83% use personal music accounts. It’s much easier to plug someone’s phone into an AUX cable and use an existing account than to seek a business streaming license.
#soundtrackyourbrand helping out to pay artists and songwriters fairly! https://t.co/dW70r3ngoT
— ola sars (@olasars) October 15, 2018
“Business licenses give music creators fair, and typically much higher, compensation when their music is used to benefit commercial activity,” Soundtrack Your Brand states within its study. “Consumer streaming services don’t include those rights and that’s why they aren’t allowed to be used in places of business. Their Terms of Use clearly state this.”
Most business owners are unaware that there’s even a difference between business and personal streaming licenses. 71% of U.S.-based small businesses believe it’s fine to play music from a personal account. Co-founder and Chairman of Soundtrack Your Brand, Andreas Liffgarden, stated that lack of innovation and accessiblity has driven business owners to use consumer services.
“We need a new generation of B2B streaming services, attractive to business owners, that make sure music makers get fair compensation,” Liffgarden said within the study.
With 21.3 million businesses using consumer services globally,
— Soundtrack (@soundtrack_io) October 15, 2018
rights holders may forfeit a total of $2.65 billion annually. Read the full study: https://t.co/oZBBOAnHhX
Bringing awareness to the lack of business streaming licenses is the first step. Next, small businesses (ahem, hipster coffee shops included) must do their part to give back to the music industry on which they rely to keep their customers comfortable and coming back for more.
