Music licensing companies oversee the use of copyrighted music and are responsible for collecting music licensing fees from businesses and organizations. The licensing companies distribute royalties from licensing fees to the musical artists, composers and publishers they represent.
Music licensing companies are also known as performing rights organizations. Licensing companies are responsible for monitoring the use of copyrighted music played or performed for commercial purposes. Any time a copyrighted song is played or performed live in media such as radio, television, movies and entertainment specials, licensing fees must be paid to the licensing company. Businesses such as bars, restaurants, nightclubs, hotels and retail stores are also subject to U.S. copyright laws and, therefore, must pay licensing fees before using certain music. It is the sole responsibility of the business benefiting from copyrighted music to obtain all rights to use that music. Businesses and organizations who are caught using licensed music without paying fees are subject to stiff legal penalties, and they are often sued by music licensing companies to recover damages.
It is important to note that purchasing a license from one music licensing company does not provide blanket protection for all music. It may be necessary to purchase a license from all music licensing companies to avoid legal trouble.