By Sabeine Heindl, GM, Music Industry, Piracy Investigations.

Music is an integral component of a successful restaurant, cafe or retail store. It’s possible to attract different types of customers with the right mix of music and research confirms how music adds value to business, through increased sales, productivity and brand presence.

But is the music in your business being used legally? Increased broadband internet penetration, advances in technology and digital download services have allowed for easy access to a greater variety of music and more of it. Understandably, this has also been accompanied by growing confusion about what represents appropriate and legal use of music in business environments. This article aims to assist you in understanding the “do’s and don’ts” of using music within your business.

To begin with, it is important to have an idea of what copyright is and what it protects. Intellectual property law protects the expression of ideas and allows people who create music, literature and art, among many other creative forms, to make a living from their creations. The process of creation, from the idea to the finished product, often requires a significant contribution from more than one person. Consequently, there is generally more than one owner of copyright in any given song, to take a musical example. The composer who wrote the music owns copyright in the musical works. The lyricist who wrote the lyrics owns copyright in the literary works. The artist who performed the music owns copyright in a sound recording of their live performance. Finally, the maker of the recording (typically a record company) owns copyright in the sound recording. All of these parties have enduring intellectual property rights stemming from their unique and important contribution. Just as your retail logo cannot be copied and used without permission, a song cannot be burnt, ripped from the internet or played publically without the permission of the relevant copyright owners.

The illegal use of music is a very significant threat to those in the music industry. Not only are the copyright owners such as musicians, songwriters, and labels negatively affected by the illegal use of music, but so are numerous other people employed in the music industry who all depend on music sales for their livelihood. In a restaurant, cafe or retail store, common examples of illegally using music include playing burnt CDs, creating playlists from hard drives containing copied music or playing music illegally downloaded from the internet through networks such as Limewire and e-Donkey.
The following commonly asked questions and answers may help you better understand what is legal and illegal use of music within your business:

How do I know if I am doing the right thing?
Q. I bought a legitimate CD. Can I make copies or burn it onto a hard drive system for use in my store?
A. No, the purchase of a CD only gives you the right to own the physical disc, to play it privately, and to pass on the same physical disc to another person. This means that copying the music from a CD, without the permission of all relevant copyright owners, is an infringement of copyright except in very limited circumstances. Recent changes to the Copyright Act allow you to “format shift” music for personal use; for example, to copy once from CD format to MP3 format in certain limited situations. However, this does not extend to use of the music in a cafe, restaurant or retail store.

Q. Is it illegal for me to download music from the internet and play it in my store?
 

A. Yes, the basic legal principle is that you cannot copy or distribute music including from the internet without the permission of all relevant copyright owners. Even if you legitimately buy music from iTunes or other legal online distributors generally you can only use it for personal, non commercial use. You should check the relevant terms and conditions if you are unsure.

Q. What if I download music to use in my shop from a site from overseas where the law might be different?
 

A. Internet activities of this sort typically involve acts of copying, transmission, or distribution in both the ‘receiving and sending’ countries and laws of each will apply. Be aware that if you download music files to your PC located in Australia, without the copyright owners’ permission, you are committing an infringement of copyright under Australian law.

Q. Do I need any licences to play legitimately purchased music in my store?

A. Yes, there are a number of licences that may apply depending on how you are using the music (see https://transactions.business.gov.au/BLIS/musiclicence.aspx). Basically the owner or operator of the cafe, restaurant or retail store must have a PPCA public performance licence to play protected sound recordings and an APRA public performance licence to play the musical and literary works. Further, the music must be from an original legitimate source.

Q. What might happen to me or my business if I infringe copyright laws?
A. People who use music illegally can be fined up to $60,500 and receive up to five years imprisonment for each indictable offence. For companies, the fines are up to five times as much – that’s over $300,000. Under recent changes to the Copyright Act, the police can also issue an on-the-spot fine of $1230 and seize copies of illegal music.

Stealing music is the same as stealing anything else. The consequences are real, for artists, songwriters, you and for the future of music. You wouldn’t sit by and let somebody steal goods from your retail store or cafe. Respect those in the business of music and use music legally.