Spotify Business License - Use Spotify For Commercial Usage

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Can I Play Licensed Music In My Business?

Can I play clean music from my personal Spotify account at work? The simple answer to this is “no.” However, understanding licensing laws and streaming music for business can help you find a solution that is just as simple.

Spotify represents about 36% of the global music streaming market, with only a few major competitors, including YouTube, SoundCloud, Pandora, SiriusXM, and Apple Music. However, all these services are primarily directed to individuals, with licenses allowing streaming music and/or video for personal use.

If you broadcast streaming music to your customers in your business, this is legally considered a public performance, and it requires a different type of business-specific license.

The Goal of Playing Music in Your Business

When licensed music is played in a commercial space, it is played with the intention of creating an experience for customers that is conducive to the interests of the business.

Happy customers make businesses more money, and music can make customers happy. Since you are financially benefiting from another’s creative work, that artist deserves some income for their intellectual property.

Copyright Holders Must Be Paid

Published or recorded music is owned by someone through intellectual property rights. Copyright law also stipulates that when the music is played in certain public or global spaces, the copyright holders must be compensated. This supersedes legal purchase of the song (either in a digital or CD copy) for individual use (a private performance) since part of the song’s retail cost goes to the artist and publisher.

Companies like Spotify make this very clear in their terms and conditions. Spotify’s website clarifies that a personal account does not allow the user to play songs in public spaces, like stores, clubs, restaurants, and bars.

An individual account allows users to stream music privately without any intention of using the music to boost their business. As with most terms of use, agreeing to them is the user’s acknowledgment that they will use the personal account within the specified boundaries.

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Spotify for Business

Instead, a Spotify Business account works as a commercial license subscription. It gives users the legal coverage to stream and download internet-based music through the Spotify Business platform, and to play it to anyone within the business’s premises. This is one way that Spotify itself makes money.

While over 100 million people use the free version of the platform, the company receives payment from just 30 million people to unlock additional features. As a result, the company has been bleeding money because of how expensive its licensing agreements with record labels are. Collecting monthly fees from businesses helps to offset the exorbitant deals it has with the publishers of some of the biggest artists in the world.

Soundtrack Fees

Having a Spotify for Business account ensures that anybody who has a copyright claim to the music — the artists, the record label, or both — is fairly compensated every time their music is used in a professional setting. The Spotify for Business (also known as Soundtrack) cost is $39 per month for the base plan. Other music streaming services, like Pandora with Pandora for Business, have their own business arrangement, and it works in much the same way.

Users with a Spotify business license pay a monthly flat fee to access and play songs, safe in the knowledge that the respective services have arrangements with the necessary performing rights organizations that disburse royalties to labels. Through the use of a Spotify for Business license, a store will be playing licensed music lawfully.

Spotify & Soundtrack Partnership

Soundtrack (previously named Soundtrack Your Brand) was founded in 2013 by Swedish developers who originally worked for Spotify, so the company’s core concept is very similar. This is why Spotify chose to partner with them to get access to Spotify’s huge library of music for commercial subscribers. This requires negotiating different licenses with performing rights organizations (PROs).

If you have a personal Spotify account, you are familiar with the basics of using Spotify for business. Access to this type of streaming interface will help your employees too, as they manage music playlists throughout the day.

The Costs and Benefits of Spotify for Business

Soundtrack Your Brand isn’t free. The company requires participants to pay a fee to access the services.

At the time of this writing, Soundtrack pricing starts at $39 per zone per month. Enterprise customers with more than 20 zones can tap into custom pricing that allows for full access. You can try services for 14 days at no risk with no credit card required, but when that trial ends, you must pay those fees.

While paying another fee isn’t ideal for most businesses, the money you spend here could protect you from lawsuits later.

How to Play Music Legally (and consequences for Noncompliance)

As soon as a song is fixed (or otherwise recorded or written down in some manner), it’s protected by U.S. copyright law. That law gives the creator or owner of the song permission to charge fees for the use of that song. The law also allows the copyright holder to ask for relief from the courts if the songs are used without permission.

Consequences

Penalties for copyright infringement are set at not less than $750 and not more than $30,000 per work infringed. That means playing more than one protected song without permission could mean more than one penalty fee.

If the courts determine that the infringement is somehow willful, they can impose a fee of $150,000 per work infringed. The courts can also impose criminal penalties of up to $250,000 per offense and imprisonment of up to five years.

Steps to Legally Play Music

To play music legally you must:

Have written permission from the copyright holder.
Pay the associated fee.
Don’t play any songs not covered by the license.

Having permission to use a Spotify account for personal use won’t protect you in a business setting.

When you play music in your business, you’re holding a legal “public performance” of that song. You need a special license to do that. The following two methods can help you get started.

Work with Performing Rights Organizations (PROs)

Performing rights organizations are groups like the American Society of Composers, Authors and Publishers (ASCAP); SESAC (originally the Society of European Stage Authors and Composers); and Broadcast Music, Inc (BMI). These organizations represent the rights of songwriters and music publishers to publicly perform the copyrighted works they created.

To work with a PRO, take the following steps:

Identify the PRO that represents the songs or artists you want to play. This could mean reading the fine print on a CD or looking at the description on a website like YouTube.
Contact the PRO and outline how you want to use music. Companies typically require information about the type of business you run, the size of your facility, and the number of people who might hear the songs.
Sign a contract and pay the fees.
Only play music that’s within this PRO’s catalog. Otherwise, you’re violating copyright laws.

Work with Third Parties like Spotify for Business

Big distribution platforms like Spotify have their own next level arrangements with PROs, which simplifies things for business owners who want to stream music in their stores. Just having a Spotify Business account grants you access to the repertoire of songs covered by the respective PROs.

Third parties also typically offer customization options that could be critical for businesses. They can include the following:

Playlists: Many third parties give you the ability to build a completely custom playlist that fits your brand personality. Some also provide pre-programmed channels with music created for specific industries (such as spa music).
Scheduling: Third parties can provide you with tools to change the music you play throughout the day. For example, you might play an upbeat playlist in the morning and switch to smooth sounds at night.
Volume: Third parties often allow companies to control how loud or soft the music is via the app or controller (not by touching the speakers).

Commercial Streaming Providers

Several third parties exist that can grant you this access. This table can help you understand their similarities and differences.

	Costs	Features	Unique Selling Points
Spotify for Business (aka Soundtrack Your Brand)	Starts at $34.99 per month	Fully licensed music, curated playlists, scheduling tools, and the ability to create custom stations	Focuses on brand alignment and creating the right atmosphere for customers
Pandora for Business	Starts at $26.95 per month	Ad-free music, customizable playlists, scheduling options	Provides a simple and affordable way to play Pandora stations you love in a business setting
Rockbot	Starts at $25 per month	Licensed music, curated playlists, scheduling	Provides interactive features, like customer song requests via an app; incorporates media (like signage)

How to Set Up and Start Using Business Music Streaming

Whether you’re using Spotify for Business or another streaming service we’ve discussed, you’ll need to take a few basic steps to get set up and start the music playing.

While the details can vary from service to service, the following basic steps are typically required:

Sign an agreement. Business streaming services typically create custom licenses for their customers. The documents should tell you what music you’ve purchased, where you can play it, and how long your agreement lasts. Sign this document and keep it handy in case you have questions.
Gain access. Music streaming services place their music on the cloud, so customers can access it anywhere in the world. With your signed contract and paid fee, your streaming service should provide you with a login and password.
Link your player. Some streaming services work with any connected device (like a phone). Others require customers to buy a special player to share the music.
Link your speakers. With your player connected to the service, you can connect your speakers to the player. With this final step, you should be ready to play music.
Customize the sound. Business streaming systems offer plenty of tools for business owners. You’ll need to choose music to play, identify how loud it should be, set up specific rules for times of day, and more. In most cases, this work is done through a digital dashboard you access with your password.

How to Choose a Streaming Service by Industry

Since Spotify for Business isn’t your only choice for legal music streaming, how can you make a smart decision? Answering a few simple questions may help.

While you’re researching your options, think about the following issues:

Noise level: Are your customers visiting you to do something quiet (like shop) or something noisy (like eat with chopsticks)? If volume control is critical, you need a partner who can help you turn down the sound at the press of a button.
Size: Is your business small (like a one-room antique shop) or large (like a multi-level warehouse)? If you need to play different music in different locations, you need a partner who offers zoning.
Locations: Do you have just one outlet (like a one-person flower shop) or a multi-location empire (like a chain of restaurants)? If you have more than one location, you’ll need a sophisticated partner who can help you control music in all of your businesses from one dashboard.
Music use: Are you playing music in the background (to cover up chewing sounds in a restaurant) or in the forefront (to set the mood in a hotel)? You’ll need a partner who plays the music you think your customers will want.

Don’t be afraid to ask your potential vendor to share a list of businesses like yours that are signed up with them. If you see many similar names, this company may have the experience in your industry that you want and need.

The Terms of Using Licensed Music

Legally purchasing the music being played is not the same as legally owning that music, according to intellectual property law.

As The Guardian explains, a consumer simply buys the right to play the particular song per the terms set by the copyright holder. For individual consumers, those terms are almost exclusively for the song or album to be played in a private (or, at least, a nonpublic) setting. Attempting to use that same song in a public setting, like Spotify for retail stores or Spotify for hotels, is a violation of the terms of purchase, akin to using a rental car as a personal vehicle.

The public performance clause in the copyright law includes, but is not limited to, streaming music from digital sources, playing MP3 files from a music player, CDs, music videos on TV, and music played by a DJ.

If you listen to your own music on a break, away from customers, this does not constitute a public performance, so you do not need to worry about using your personal Spotify playlist. If you think these playlists are something your customers would enjoy, get Spotify for Business and you can transfer your personal playlists over and play them legally, to create a great atmosphere in your establishment.

Business to Consumer vs. Business to Business

In general, services like Spotify, Apple Music, Amazon, iTunes, SoundCloud, Pandora, and Last.fm are music platforms for individual consumers (business to consumer). Typically, they are free or have a reasonably flat monthly fee, allowing users unlimited listening.

This can confuse users into thinking that they (the users) “own” the right to do whatever they want with the music they are getting. And users do have a lot of things they can do with that music. They can stream it in their car, play it at family gatherings, or listen to it at the gym or on the bus.

But playing music in a public business setting over multiple speakers, with the intention of creating a welcoming environment for the general public to spend their time, is the function of a business-to-business arrangement, and this needs the appropriate licensing.

Commercial Music Services & PROs

Spotify and Pandora have the necessary deals with performing rights organizations, meaning that a business owner can simply pay an extra fee every month to have access to literally thousands of songs to play for customers. Additionally, this also protects the business from liability for copyright infringement.

For services that do not have deals with PROs, a license can be obtained from one or all of the PROs, which entails paying the PRO directly. There are also streaming services that are built exclusively for business use. This achieves much the same effect: legally playing music for customers in a place of business.

Frequently Asked Questions

These are questions we often hear from businesses about using Spotify for business and other streaming services.

Can I use my personal Spotify account inside my business?

No. Your personal Spotify account is designed for your exclusive use. You can play music in your home, car, or headphones with a personal account. However, you can’t use this access to stream music in a commercial setting, like a business.

Why should I pay for a business license to play music?

A license allows you to play music without violating U.S. Copyright Law. That means you won’t have to worry about facing a lawsuit from copyright holders. It also means that you’re directly supporting artists that make the music that you love.

Why is it better to work with a third party instead of a PRO?

Companies like Pandora Cloud Cover and Soundtrack Your Brand offer services PROs typically can’t. For example, they can help you create custom playlists based on your consumer behavior. They can also help you share marketing messages through your speakers.

How do companies like Soundtrack Your Brand set pricing?

Most third-party companies ask for information about your facility size, how many zones of music you need, and how many customers you serve. This data helps them create pricing plans that are right for you.