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Leading-Edge Law: Don't open Pandora at your business
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Leading-Edge Law: Don't open Pandora at your business

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I love Pandora, the online build-your-own station music service. Indeed, I wonder if I'm the only guy who has J.S. Bach's "Toccata and Fugue in D Minor," Marvin Gaye's "Inner City Blues" and Steely Dan's "Any World" on the same station.

What if I have such confidence in my obviously sublime musical tastes that I want to play this Pandora station in my firm's waiting area for our customers to savor? Could I do it legally?

In most cases, you may need a license to play the music for your customers even if you own a legal copy of the music or have a legitimate license to a music service.

Under copyright law, you need to have a license to publicly perform music. With limited exceptions, having the legal right to listen to music for private enjoyment does not include the right to play that music for your customers.

Unless you fit into an exception, you have to pay music-rights organizations for the right to perform music publicly. If you don't get a license, you could get socked in court for thousands of dollars in damages plus you might have to pay the attorneys' fees of the music companies.

For example, a federal appeals court recently upheld a decision that a California bar had to pay about $200,000 because it played eight songs without permission and then repeatedly ignored requests from a music-licensing organization for it to buy a license.

Fortunately, there are easy ways to take care of this in typical cases. Let's look at specific music sources, because how to be legal depends on the source of music:

Broadcast radio

You can play broadcast radio (AM or FM) for your customers over speakers at your business without having to buy public performance licenses, if your business does not exceed certain square footage and if you abide by certain limitations on speakers.

The details of the rules are too long for a column, but you can find them on the "Licensing FAQ" section of the website of ASCAP (www.ascap.com), which is one of three music-licensing agencies.

Pandora

Most people listen to Pandora (Pandora.com) without subscribing. Yet, even if you subscribe to the premium service (Pandora One), you cannot play your Pandora station for your customers. Your personal-use Pandora license prohibits doing so.

Fortunately there is an easy solution. Pandora has partnered with DMX to offer special hardware that you can use to play your Pandora stations for the public at your business. Visit www.dmx.com/pandora. Currently, this DMX service costs $25 a month plus $75 for the hardware. As part of the package, DMX pays for the public performance licenses for you.

Sirius XM

The same rule applies here as with Pandora — even if you have a personal-use Sirius XM subscription, you can't play it for your customers.

Like Pandora, Sirius XM offers a business-use version of its service. The monthly subscription fee (it starts at $30 a month) is higher than for a personal-use subscription, but it covers the public performance licenses.

Personal collection

Suppose you want to play music you have downloaded from iTunes or you have on CDs.

To do so legally, you have to purchase public performance licenses from each of the three licensing organizations — ASCAP, BMI and SESAC. Between them, they hold licensing power to nearly all commercially available music. In theory, you could buy a license from just one of those entities, but you'd have to make certain you play only songs from its catalog.

You're probably better off by just using the commercial version of Pandora or Sirius XM or subscribing to a commercial-use music service. There also are various companies that provide music services and take care of licensing for you.

Whatever you choose, just stay legal. Otherwise, to quote Marvin Gaye, your legal bills will "make you wanna holler."

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