By: David Oxenford, Wilkinson Barker Knauer LLP
As business adapts to the pandemic so, too, do legal issues. A couple have come to my attention in recent weeks that I thought bear passing on. One deals with copyright concerns, the other with FCC matters about use of unlicensed FM transmitters. Both arise as businesses adapt the way in which they deal with their customers – including how media companies deal with their audiences.
The copyright issues deal with music licensing matters. Broadcasters are used to having performance licenses that allow them to broadcast music over the air and stream it on the Internet. Venues for live music have similar licenses, as do hotels and meeting halls where conventions and other meetings take place – often involving the use of music. But, as people are no longer frequenting these locations, businesses try to recreate their usual ambiance in an online environment using Zoom, Facebook Live, or one of the many other digital platforms that now exist. If that ambiance includes music or other copyrighted materials, be sure that you have the rights to use those copyrighted materials in the new environment in which your business is operating.
In looking at performance licenses, it appears that some existing broad licenses may cover performances in any venue that the licensee operates – so they may cover using music in an online video conference hosted by the licensed audience. But not all of them do – and not all of the performing rights organizations (e.g. ASCAP, BMI, SESAC and GMR) grant the same scope of rights when they license a business – so the rights that your business or operation may have may differ depending on who controls the rights to the song that you are using. You need to read the licenses that you have very carefully, and read each license from each performing rights organization, as not all appear to cover all online music use.
Even if a performance license from one of the performing rights organizations covers your online activities, the license almost assuredly covers only performances – not reproductions of the music. So once an online meeting or performance is archived, even the performance licenses that you have can be read to cover your online uses, these licenses likely do not cover that same use when made available for on-demand viewing. As with podcasts or any other on-demand use of music, you need to get the rights directly from the copyright holder of both the sound recording and the musical composition – and that is not always easy (see our posts here, here and here).
Are copyright holders going to pursue users for these issues? Likely playing some music during a live virtual happy hour with friends and family is not actionable – and may well not even be a “public” performance. But using music in an online meeting in a commercial setting may not be treated as kindly. Especially as this becomes the new normal, copyright holders may well become more aggressive in asserting their rights. And if that commercial use is archived for later viewing by the public, the potential for enforcement issues increases. On August 4, I will be participating in a webinar that will covering some of the legal issues around the use of music by businesses. Costs and other information, as well as a registration form, is available here.
Another pandemic adaptation that can raise both copyright and FCC issues also seems to be coming up more and more. As it appears that it is safer to visit restaurants and other entertainment venues seated outside instead of inside, more of these businesses are seating patrons in what once was the parking lot and, in some communities, on the sidewalk or even in the street. Drive-in movies have been reborn – and some entertainment venues are trying to cash in on the new normal by creating their own drive-ins for concerts and other music events and other entertainment purposes as well as for movies. Even church services and other community organizations are having meetings outdoors. Again, copyright licenses can be an issue. For music uses in commercial businesses, as we wrote here, the type of license that you have may be dependent on the size of your venue – which usually excludes spaces used exclusively for parking. When those spaces suddenly are no longer exclusively used for parking, rights issues may arise. And some venues, especially when they used subscription music services for in-store operations (where many such services collect the rights fees as part of the subscription price and pass them on to the rightsholders), doing live music events outdoors may require new licenses.
Outdoor activities may also require FCC licenses. Many movie theaters use FM spectrum and low power transmitters to transmit the movie’s sound to their patrons. At very low powers, these uses (like the “talking house” used by real estate agents to entice potential house buyers by using low power FM transmitters to tell the buyer about the house on an FM radio channel from the curb) may not need to be licensed. But power levels for those unlicensed uses are very restricted by FCC rules to avoid interference to broadcasters and other licensed users. See the FCC webpage here discussing unlicensed uses and the FCC rule on those uses here.
As businesses rush to provide outdoor entertainment and other activities like church services are held with these unlicensed transmitters, be sure to use reputable contractors who install systems that comply with the FCC limitations. Too much power and you are in effect operating a pirate radio station and are subject to fines like those we wrote about yesterday. I have already personally experienced what I think may have been an instance of an unlicensed FM operation interfering with a radio station that I was listening to in my car while at a stop light near a venue that may have been using one of these transmitters. Too high a power is likely to bring complaints, and complaints can bring fines – so be careful.
In these crazy times, will businesses get in trouble for ignoring these rules? Who knows? But as what was once extraordinary becomes the new normal, more and more legal issues that may have been overlooked in the early days of the pandemic may not be so easily ignored as we adapt to deal with all that is going on. Expect rights and obligations that may well have not been top of mind to become so now, and start looking at these issues closely. Consult your lawyers and advisers on what you need to do to comply with legal requirements in the new normal.
David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline. Access information here. (Members only access).
There are no additional costs for the call; the advice is free as part of your MAB membership.