How is bizzaudio PRS PPL exempt?

Music licensing and copyright law are notoriously complex and the laws and organisations involved vary from country to country. It's also a rapidly evolving area with new developments arising  all the time.

The most important thing to understand is that a recording, whether played from a CD, vinyl record or a streaming platform like Spotify, comprises a set of rights that are controlled by various entities, and these entities e.g. a songwriter, record label, music publisher, recording artist - must grant the rights for the use of BOTH THE RECORDING AND THE COMPOSITION or SONG, embodied in the recording.

In any recording (i.e. a track featured on a CD, download or streaming service) there are broadly 2 specific copyrights:

1.  in the actual recording that was produced and recorded for posterity in a master recording (the master copy from which other copies are made) usually owned and / or controlled by a RECORD COMPANY with the agreement of the recording artist, record producer and performers (e.g. session musicians)
2.  in the underlying song - the melody and lyrics - usually controlled by a MUSIC PUBLISHER with the agreement of the songwriter.

When a song is streamed or sold to the public on a CD or via download or a stream the purchaser effectively buys a licence to play the recording and the underlying song FOR PERSONAL USE ONLY.

In law there are separate and distinct rights required to be granted to PUBLICLY PERFORM the recording and the song, a so-called public performance right. This is why it is technically illegal to use consumer streaming services like Spotify in a business venue, because the copyright owners that granted rights to Spotify only granted then the right to distribute the music for PERSONAL USE.

The right to publicly perform a recording in a business venue, or to broadcast it in a video, on the internet, or to broadcast it in a TV programme via a TV channel REQUIRES A PERFORMANCE LICENCE and because tracking and administering such use is an enormous and complex task, record labels, recording artists and performers GENERALLY delegate this responsibility to a COLLECTING SOCIETY, A MEMBERSHIP ORGANISATION, granted the right by the copyright holders to issue licences to music users and to collect and distribute the royalties to the relevant recording and composition rights holders.

For recording rights holders in the UK, it is Phonographic Performance Limited or PPL who issue BLANKET LICENCES to business users and then distribute the proceeds back to their label / recording artist members based on whatever data they can acquire top identify what music has been played by the business user.

The same is true of SONGWRITERS AND PUBLISHERS but with the additional right of live performance to licence. If a cover artist performer plays a Beatles song in the local pub for example, the pub owner must have the appropriate licence and should supply details of songs played on the premises, in this instance to the Performing Rights Society or PRS in the UK.

Recently the PRS and PPL created a joint venture to issue one combined licence, the PRS PPL Music Licence, covering both recording and composition rights to retail, hospitality, leisure and other businesses playing music on premises. 

Bizzaudio and its clients circumvent this obligation in the UK by exclusively supplying/playing exempt music, exempt because either:

1. The writer and performers are not members of any collecting society OR were not at the time of granting rights to bizzaudio OR
2. They are a member of the PRS but have 'opted out' of PRS mandate to collect for public performance in public spaces in line with PRS terms OR
3. They are members of collecting societies outside of the UK that unlike PRS allow their members to licence directly to bizzaudio and other licensees e.g. ASCAP, BMI, SESAC in the USA where the member agreement is non-exclusive.

If the status of a writer or a recording artist or performer changes then bizzaudio reserves the right to remove tracks from the service to ensure that the music played in a client venue remains exclusively exempt.

Major label artists and repertoire therefore is not available on the bizzaudio service but more and more artists and small independent labels are moving to direct licensing because it provides them with income which often does not accrue from PRS or PPL membership where smaller artists and writers are often underpaid (if paid at all) because often, only radio play data is used as a proxy for determining royalty distribution from blanket licences which unfairly benefits major stars.

Bizzaudio reports every track played in all its client sites and payment is made equitably based on the share of plays attributable to a given music provider on a monthly basis. In some cases bizzaudio pays a buy-out fee as a one off compensation for the grant of performance and reproduction rights for an agreed term.