When I was working in a casino in the early nineties with a band four nights a week, I got awfully tired of Sharp Dressed Man. So, I’m wondering; those bands (most of them) who cover everybody’s favorites are theoretically paying some kind of royalty. I can’t imagine the composer and/or publisher not caring about all those public performances but, OTOH, collecting from what has to be a couple hundred thousand performers would be a logistical nightmare. Does buying the sheet music cover it or is there some kind of blanket payment they can pay to be in the clear?
The bar generally buys a music license from BMI or the like. That covers both live music and the jukebox.
I’ve known a few bar bands in my time and they didn’t pay anything. Hell, a lot of them can barely afford groceries. No way are they going to be paying royalties.
I remember a bar I worked at having the BMI logo stuck on the door. I always wondered exactly how that worked. I wonder if the bands care at all and sometimes play ASCAP songs?
My understanding is that it works like this:
ASCAP/BMI are middlemen/enforcers. They contract with songwriters to enforce license rights. They then sell those licenses to bars/restaurants/radio stations/etc. that hire musicians or play music.
To encourage people to pay up, they’ll go around to public locations that play music and that don’t have an agreement with them and sue the proprietor for damages if they hear music registered with them.
They don’t sue bands primarily because you can’t get blood from a stone. The vast majority of bands playing in bars are fairly judgment proof. They sue the venue owners.
Yeah, BMI or ASCAP – is there any other big gorilla that’s entered the songwriters’ protection racket?
For those that have never experienced it: BMI and ASCAP have reps that visit businesses that have music playing for the public (bars, restaurants, retail, whatevs) and shake down any businesses that aren’t already paying dues but are playing music by songwriters on their roster.
And that’s fine with me – artists deserve to be paid, etc. I just find it fascinating that the basic mechanics of the business model are so similar to Mafia-style extortion.
EDIT: ninja’d 
Occam’s Razor suggests either a) ASCAP didn’t send a sticker or b) someone peeled it off. Or maybe c) a business so disorganized/clueless/financially troubled that they paid fees to only one of the two licensing companies.
(I’ve never noticed a BMI or ASCAP sticker – how long ago was this, and where, may I ask?)
I never noticed a BMI or ASCAP sticker. Maybe there was a license in the office.
I figured that might be the case, but BMI is, after all, Broadcast Music, Inc. I guess they branched out. 
I play in a band. A hobby band anyway. We’ve recorded an EP and we regularly perform around the Portland, ME area on the order of, oh, say four or five gigs a year. We get out of not paying royalties by not playing any covers. All originals.
There are few clubs in town that cater to only bands that play originals; pretty much because it’s cheaper. **Silenus **nailed it one. It’s the club that buys the licenses, so you can go on about how you’re trying to be the new CBGB’s, man, when really you just don’t feel like ponying up to ASCAP/BMI.
I own a bar and yes the licensing outfits took their business model from the mafia. They don’t play. There are 3; BMi, ASCAp, and one other which I forget. The fee is based on capacity and how often you have music acts.
The background music we play is also subject to royalties. We use Pandora Commercial.
On summer weekend nights, we project movies out onto the neighbors building for guests in the beer garden. I only use non-copyrighted movies which is anything from before 1923 and certain other movies that have let the copyright expire. I download them from a website that guaranties they are public domain. Companies that package old non-copyright movies onto DVDs put their own copyright onto their version.
We don’t have TVs on purpose but if we did they would have to be showing a commercial package. Anything copyrighted played in a commercial setting is subject to royalties.
SESAC. They are more popular in Country and Folk.
The unfair bit is that the payments are based on popularity according to a complex formula. If they wanted, they could install a box at the venue that could use a Shazam-style song recognizer to exactly apportion the fees to the real songwriters. But they don’t apparently have any interest in doing so.
I ran into these people back in the mobile disco days, and everyone we encountered acted like a b-movie Mafioso.
A friend of mine had to discontinue live music at his restaurant due to cost and headaches of dealing with ASCAP/BMI. He describes them as ruthless. He cannot even hang out with friends at closing time and play. He also had to pull some of the TVs from the bar area over fees.
My wife works for The Church and has to, quarterly, send in a complete list of all copyrighted songs played there. Or, she’s threatened with eternal damnation! 
They’re an oligopoly! (The licensing companies.) Songwriters are probably happy to get whatever pennies the licensers can squeeze out of license payers, even if those pennies are unfairly distributed.
Your idea of a song-identifying machine does suggest an alternative business model. But the logistical challenges are formidable. You’d need a critical mass of catalogued songs (and a decently reliable enforcement mechanism) to make it work. Won’t happen soon, if I had to guess.
I was just going to say that this is a line in my own church’s budget.
Churches pay royalties?
I guess you mean the hymns sung during services?
You betcha they pay royalties. There is a HUGE catalog of contemporary Christian (and other faiths) music–and performers–and people want to hear what they’ve heard on the radio. And not just in contemporary services. The Catholic church where my wife is currently employed pays a license; the Methodist church she was at had to send a full song list due to a different licensing agency. Some of the hymns are in the public domain, some are copyrighted; there are myriad other licenses/payment schedules, what have you.
It was an education for me, I’ll tell ya.
Not to mention all the stuff that gets played at the “Youth Ministry” services. Even though “Christian Rock Music” is an oxymoron, you still have to pay royalties. “Render Unto Caesar” and all that.
Amen.
:o
(There is Christian heavy metal, Christian rap, etc.)
As Hank Hill said, you’re not making Christianity better, you’re making rock and roll worse.