These days, it’s hard to imagine a restaurant or bar experience that is not accompanied, in some part, by music. Music can be essential to create the personality of an establishment. It’s no surprise, therefore, that the owner of a bar or restaurant will invest a lot of energy in choosing just the right music, whether live or recorded, to accessorize and influence how guests feel about their overall experience at those venues.

And just like purchasing the right lighting, flatware, wall decorations or other touches for the venue, the music comes with a price tag. The public performance of music in live venues is protected by copyright as much as is creating a CD.

The concept of “Public Performance” is crucial to bars, lounges and restaurants where music is played because the right to perform music “publicly” in such settings is controlled exclusively by the aforementioned music creators or those who administer their rights. And, under the copyright law, any music that is played outside a normal circle of friends and families is considered a “Public Performance”.

So, if you want music in your establishment, how do you secure the “Public Performance” rights? Conveniently, the Public Performance Rights to the vast majority of music that is likely to be played in a bar or restaurant in the U.S. is administered by one of three leading Performance Rights Organizations (also known as “PROs”): ASCAP, BMI and SESAC. These PROs have deals in place with composers or their publishers which enable the PRO’s to enter into licenses for the music. And, all you need to do is contact the PROs (yes, all of them) and fill out an application that describes your venue and how the music will be used and then pay the PROs a license fee that is calculated to relate to your particular intended uses. Paying these fees is a cost of doing business and should be budgeted into your operating expenses.

And what if you don’t secure such a license? Well, to begin with, this wouldn’t be fair to the music owners. Their contribution to your customer’s experience has a value just like your establishment’s design, food, service, etc. And the music, like the other elements, is not free. Moreover, playing music without a license is simply illegal and constitutes copyright infringement that subjects your business (and possibly you) to severe penalties.

Unlike those infringement warnings that we all remember seeing on the films we rented or the CDs we used to buy – which warnings were intended to discourage us from making or distributing copies of the entertainment that we were enjoying, but which never seemed all that immediate or personal — the PROs are deadly serious about protecting the rights of their members and they will take steps to enforce those rights if you play music without the proper license in place.

Indeed, in recent years, these PROs have become quite vigilant about these licenses and have commenced several lawsuits against reluctant restaurant and bar owners who refused to get the necessary permissions to play music. These lawsuits have been quite successful and lucrative for the PROs and their members (especially since Federal law is on the side of the music owners).

And, don’t think that a license is not required if you plan on playing or streaming music from the radio, the Internet, your iPod or through TV or cable etc. The source of the music in those instances does not change the obligation of the bar/restaurant to secure a Public Performance license. Remember, when you purchase music for your iPod or other MP3 player, it is supposed to be for private use, not public dissemination.

Live performances also do not relieve the bar/restaurant owner/operator of the obligation to procure a Public Performance license. Even “original” songs are typically registered with the PROs and covers are most likely also so registered. The fact that the music is played live is irrelevant.

Additionally, when live music is performed, you have the added concerns of entering into agreements with the musicians that spell out what your and their respective rights and obligations are with respect to their performances, how they’ll be paid, whether you can use their names/likenesses to promote your business and whether you or they can tape or record their performances for future use.

In sum, music is and should be an integral part of a patron’s enjoyment of a bar or restaurant experience, but those who own or control such music must be compensated for their contributions to that experience.