You hit play on a Spotify playlist, connect your phone to the store speakers, and carry on with your day. It feels harmless, but if that music isn’t properly licensed for commercial use, you may be breaking federal copyright law without knowing it.
The law states that music played in a store, cafe, restaurant, and most other businesses is considered to be a public performance, which makes that song or playlist fall under copyright. The enforcement agencies that actively seek out these types of copyright infringements are called performance rights organizations (PROs).
Business owners should understand the risks and fines associated with playing unlicensed music. Here’s exactly what can happen, and why the consequences are more serious than most owners expect.
It’s Legally Considered a “Public Performance”
One of the exclusive rights provided by Section 106 of the Copyright Act is the right to control public performances of a copyrighted work. That means even the kind of music that plays unobtrusively in the background will trigger copyright obligations the moment it’s audible to customers.
A public performance occurs when you play music in a public place with audience members that extend beyond family members and friends. Your retail floor, waiting room, lobby, reception, or dining area all qualify.
And here’s where many owners get caught off guard: even if a store owner has a personal Spotify account, the terms of that account do not cover playing music for the benefit of the general public as background music for a business establishment.
Spotify says its service is for personal, non-commercial use and cannot be played publicly from a business. The same applies to Apple Music and YouTube.
What You Need to Know About Performance Rights Organizations
There are four main performing rights organizations (PROs), GMR, BMI, ASCAP, and SESAC that monitor infringements and collect payments for public performances of copyrighted music.
ASCAP, BMI, and other PROs aggressively protect their artists’ copyrights. They routinely send investigators to various venues, large and small, to see what music they play and whether they have the appropriate licenses.
Real-world examples show this enforcement isn’t just theoretical. In 2017, a private investigator sat inside a Washington bar and wrote down the names of the songs heard. The business owner didn’t know the investigator was there — she only found out about the visit when the lawsuit arrived.
In a separate case, ASCAP filed suit against a Cleveland bar after an undercover investigator documented specific songs being played on a Friday night, including Michael Jackson’s “Thriller.” ASCAP representatives had made more than eighty calls and emails beforehand in an attempt to secure a license.
ASCAP finds out about violations by seeing venues advertising on the internet. If businesses won’t comply, the organization sends inspectors to verify whether songs are being played without a license. Social media can also play a part: videos of live performances posted to Facebook or Instagram can serve as additional evidence.
From Letters to Lawsuits
PROs typically follow a progression before taking legal action, but they are not required to. There is nothing that prevents them from taking a business straight to court if they believe it’s guilty of music copyright infringement.
Demand letters clearly outline the infringement and demand actions such as paying past licensing fees. If ignored, a court battle is likely, and PROs routinely win these actions, resulting in significant fines.
According to USA Today, BMI sued more than 160 businesses in 2015 alone. More recently, in 2024, BMI and ASCAP together handled around 100 infringement cases, sending warning letters and pursuing settlements across multiple industries, especially restaurants, bars, and fitness studios.
Each PRO has a different catalog of music, and occasionally also licenses different parts of one song. One Cincinnati bar, despite having a license with BMI, was hit with a $90,000 ASCAP lawsuit for playing “Rock With You,” which is licensed under their catalog, not BMI.
What Is The Fine for Unlicensed Music?
Damages can vary from $750 to $30,000 per work infringed upon. However, if the court determines that the infringement was willful, the amount can soar up to $150,000 for each piece infringed. It’s crucial to note that these penalties can compound quickly, especially if multiple works are involved.
A business is not facing one fixed fine for “playing music.” A playlist could include many protected songs, and each one can add to the claim. And it’s not just the fines. A federal court lawsuit is publicly available and easy to find on the internet, which can generate unwanted negative press that hurts your brand.
Are There Any Exceptions?
A few narrow exceptions exist. If your business consists of selling recorded music, you may be exempt from annual license fees, but only for performances meant to promote the retail sale of those specific recordings, and only in the immediate area of the sale.
Stores under 2,000 square feet, and restaurants and bars under 3,750 square feet, may play music over a radio, TV, or similar device under a limited exemption, though this doesn’t cover streaming services or dedicated sound systems.
What Does Compliance Actually Cost?
The good news is that getting licensed music is far less expensive than defending a lawsuit. The simplest and most cost-effective approach for most businesses is to subscribe to a commercial background music service.
Dynamic Media is a reseller of SiriusXM for Business and Soundtrack (Spotify’s business alternative), which handles all royalty payments as part of a single monthly fee, so you never have to manage individual licensing relationships yourself.
The Bottom Line on Unlicensed Music
Playing unlicensed music in your store isn’t a gray area, it’s a federal copyright issue that PROs actively pursue. The combination of undercover investigators, escalating demand letters, and statutory damages up to $150,000 per song means the risk is real, even for small businesses. Getting compliant is straightforward and affordable. Getting caught is not.