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The purpose of a Performance Rights Organization is to figure out who’s music is getting played and then paying that artist, writer and publisher for those public performances of their work. It’s hard to put a price tag or a number on how important music is to the world, but long ago, when the record business was just getting started, artists and writers of music argued that what they were doing was of some value to the world. And radio stations and bars and clubs and concert halls and shopping malls all agreed, music definitely was good for business. So around this time the first Performance Rights Organization was created. It was called the American Society of Composers, Authors, and Publishers or ASCAP. It’s job was to figure out all the ways and places in which music was being used publicly and how to turn that into dollars for the people creating the music. They came up with a scheme that was pretty simple to understand and quite effective. They did this by selling licenses to any place of business that used music. A license is a permit issued by an owner or an authority to own or use something. If you wanted to start a radio station you had to buy a license from ASCAP. If you owned a club where live music was going to be performed you had to buy a license from ASCAP. If you owned a store where you were going to play music to create a relaxing atmosphere for your shoppers, you had to buy a license from ASCAP. There are now three major organizations that collect performance money for artists, one being ASCAP, another being BMI and the last being SESAC. All do the exact same thing: Collect money for artists, writers and publishers for the public performance of their songs.

Performance Rights Organizations: The Differences

So let’s take a closer look at each Performance Rights Organization:

ASCAP:

The oldest of the Performance Rights Organizations. ASCAP is also the largest of the three. They pay their artists based on a complex formula that includes some factors like:

-Time of day that the song is played: The best times to get played are from 7am to 10am. Then the next best time to get played is during the drive home for most people, like 4pm-7pm. The money gets less and less for worse time slots.
-Where it is performed: An example would be a Top 40 radio station. A Top 40 radio station is worth more than a specialty station like an oldies station.
-How is it used: If it is being played while the credits roll for a T.V. show that would be worth less than if it were featured on a radio station.

There are a few other factors but I think you get the idea. All this is put together to issue the songwriters and publishers credits. Credits are worth a certain amount of money that changes based on how much money ASCAP collects each year. The last time I looked a credit was worth $6.

ASCAP collects information on who is getting played when and where in a couple of ways. They sometimes do a “deep” two week survey called a census in which they keep track of each and every individual track that is being played by a particular kind of medium (like all Top 40 radio stations) or they just do a “lighter” survey called a sample survey that does spot samples in many different areas but covers many different mediums (like radio, TV, movies etc.). It’s kind of like the difference between “spot checking” your math assignment, where you just check ten problems throughout your assignment and then assume that the rest follows that pattern, or where you check every single problem and know which are right or wrong. One way is less accurate but is faster, the other is more accurate but takes much more time. Such is the way with ASCAP.

ASCAP costs $10 to join and you are a member for life. You never have to pay again. Quite a deal!

BMI:

The second largest Performing Rights Organization. BMI is ASCAP’s main competition. They, too, have their own set of equations that are based on roughly the same factors as ASCAP.

The main difference might be in the way that they figure out who is getting played where and when. BMI has EVERY radio station submit their entire playlist for 3 days in the year. BMI looks at all the data and says that if you showed up on, say, 3 months of different radio station’s playlists then you must have been getting played on all the other radio stations that they didn’t check at that time. They assign you your credits based on that. This difference can sometimes lead to more or less money than ASCAP so many artists, writers and publishers affiliate with BMI.

BMI costs a bit more than ASCAP to join and there are yearly dues to remain a member.

SESAC:

Definitely the smallest of the Performance Rights Organizations. However, sometimes a lot can be said for being small. They have a reputation as being more responsive to the ‘little guy’. While ASCAP and BMI are busy collecting millions of dollars for most of the biggest name artists, writers and publishers, SESAC has carved a niche for themselves as being a bit more helpful to not-so-big-name people.

Unfortunately, they are a bit more secretive about how they figure out who is getting played where and when, but it must be similar somewhat to ASCAP and BMI, otherwise they couldn’t stay competitive.

And unfortunately, they don’t make it very clear what you must do to join. It appears you must contact one of their representatives and go through some sort of selection process. Again, this could be good in that it weeds out the riff raff, but then again, you may not make the cut!

I hope this explanation helps those looking into a Performance Rights Organization.

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Hans Erik
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Hans@Next2Friends.com