BMI Sues Small Pizza Shop for Playing a CD

Donny Hinson · Post by **Donny Hinson** » 19 May 2004 5:27 pm

Carl, as usual, you make a lot of sense. I gotta agree with you.

also...

ASCAP took in $688 Million buckos last year, and kept $90 Million of it. The average Joe was paid $341.71

I LOVE those kinds of statistics!!! (Thanks William) That sounds like a pretty good profit margin for "Mr.Big" to me.

And as usual, the little guy is getting screwed by "Mr. Big".

And as usual, he's the same little guy that defends "Mr. Big" so vehemently.

And as usual, he can't be convinced he's barking up the wrong tree, and actually hurting himself by arguing with his potential customers.

And...

If you (ahem) steel-playing "songwriters" continue to bitch about the nickels and dimes you're losing, I imagine the steel shows will eventually disappear.

But then...you wouldn't care, would you?

After all, it's just those nickles and dimes that concern you.

I sincerely hope that someday ALL you aspiring songwriters make it big. I hope you write a song that sells a million copies. And, I hope you realize that this song (which earned some "Mr. Big" about 2 1/2 million dollars) will probably net you a whopping $22,000, after taxes and expenses. I'm sure you will be most thankful and appreciative towards "Mr. Big", who is laughing all the way to the bank and thinking "I sure am glad there's one born every minute!"

Michael Johnstone · Post by **Michael Johnstone** » 19 May 2004 6:42 pm

Gee,I dunno - I guess I've just adjusted to living in and seeing the world as it is and not some idealized version of how I think it shoud be. I've loved,studied and played music all my life. Now at 56,I'm a reasonably proficient professional musician who's done a little songwriting.I also own a nice recording studio and have produced a bunch of records over the last 20 years. My record company has had to pay royalties to other songwriters thru their publishers and BMI so when it's my turn why can't I get paid too? Look,there's plenty to hate about the music business including what passes for music these days,the lame videos,the leveraged buyouts,the monolithic nature of the power structure - "Mr.Big".
But for me BMI,ASCAP,AFM,publishing companies,record companies,promotion companies,publicists,booking agents,the IRS,accountants,etc,etc are very real and I must deal with them. I have a mortgage,a family and lots of responsibilities like everybody else so music is not a hobby for me. I try to make as much money as I can off everything I do - it's called paying the bills. Someone quoted the statistic that ASCAP took in $688 million and kept $90 million last year. Let's see... that would be roughly 13%. Did we think that these agencies are non-profit organizations? Most of us play in bands where we pay our booking agents 10-15% do we not? Hello...........anybody out there in the music biddness? -MJ-

William Peters · Post by **William Peters** » 20 May 2004 4:16 am

Michael,

I am the one that produced the stats for ASCAP. Yes, 13.9 percent (actual number stated by ASCAP) is pretty low overhead, much better than most charity organizations that people donate to. I put the stats in because you said:

It's actually a rather small organization with a small suite of offices in Hollywood in a high rise office building(I've been there) as well as a few agents in other cities.

I was trying to make the point that these organizations are not small. $688M is not in the same class as a pizzeria... Its BIG business. I gave stats for ASCAP, and you are talking BMI, but I think the numbers make a point. At the time, I was not able to find specific information for BMI. But seek and ye shall find....

Here is a link with industry data which is pretty interesting. According to the New York Times, the industry raked in over $1.3 billion dollars in 01. BMI's income for 02 was $630 million dollars. Thats hardly a 'rather small organization'. So BMI and ASCAP are pretty much on par.
http://bigpicture.typepad.com/comments/2004/01/_despite_the_tr.html

Bill

Joe Casey · Post by **Joe Casey** » 20 May 2004 4:47 am

But if I got 13 % a Pizza,say he sells 2400 Pizzas a month @ $8.00. A mere average of 600 a week.Thats 1.04 a Pizza That would be 2496.00 a month thats 29952.00 from a not too busy Pizza shop a year. Man BMI and ASCAP are missing the boat.Why in New York alone there must be a half dozen shops on one block that play some kind of music. I can hear it now"what do you want on your pizza sir"? While in the background the band is playing "a waiter survives" Then theres the Cheesesteak business Hmmm.

Who needs the booze business for music to survive. Pizza anyone? [This message was edited by Joe Casey on 20 May 2004 at 05:57 AM.]

Jim Cohen · Post by **Jim Cohen** » 20 May 2004 5:31 am

While in the background the band is playing "a waiter survives" Then theres the Cheesesteak business Hmmm.

Hey! I resemble that remark!

And make that a Philly Cheesesteak!

William Peters · Post by **William Peters** » 20 May 2004 5:41 am

Joe,

But if I got 13 % a Pizza,say he sells 2400 Pizzas a month @ $8.00. A mere average of 600 a week.Thats 1.04 a Pizza That would be 2496.00 a month thats 29952.00

You are kidding, right? If you are willing to own a pizza shop in NYC to make a mere $30K a year, by all means go for it.

If you are saying that BMI should get 13 percent of each pizza, then you are saying that each customer should pay $1.00 extra for the privilege of listening to crap they don't like and didn't ask for.

Maybe the solution would be for ASCAP/BMI to install jukeboxes in shops for free, and split the profit with the shopkeepers. A win-win for everyone.

Bill

Jim Cohen · Post by **Jim Cohen** » 20 May 2004 6:55 am

Bill, I think that's a brilliant suggestion!

Michael Johnstone · Post by **Michael Johnstone** » 20 May 2004 7:22 am

I was referring to the actual number of employees and field agents which is quite small. I doubt if there's over 300 people in the whole organization. But say - we've made our respective points. Let's all be friends and have a beer and an extra large pizza and leave a 13.9% tip. -MJ-

Jim Cohen · Post by **Jim Cohen** » 20 May 2004 7:31 am

OK, Mikey. You buyin'? I like green peppers and sausage.

Joe Casey · Post by **Joe Casey** » 20 May 2004 8:41 am

Heck no I wouldn't want to own a Pizza shop.I'd eat up all the profits. Besides, if I wanted to work for a living I wouldn't have chosen music for a career.

but 13% of each Pizza sold turns me on.Vs 1/2% of nothing. Many Musician sidemen would love to make 29K a year though, or should I say dough? I just heard the barber shops are getting sued by BMI.

Talk about getting clipped.

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William Peters · Post by **William Peters** » 20 May 2004 11:32 am

Michael

Let's all be friends and have a beer and an extra large pizza and leave a 13.9% tip. -MJ-

Hey, I'll drink to that... no anchovies on the pizza though.

Bill

Mike Weirauch · Post by **Mike Weirauch** » 20 May 2004 1:11 pm

But say - we've made our respective points. Let's all be friends

Best statement in the entire thread but I thought we already were.

Jim Cohen · Post by **Jim Cohen** » 20 May 2004 6:18 pm

I knew if someone ordered pizza, Weirauch would finally show up. Throw in a beer and Smiley Roberts will appear in this thread too...

Jimmie Misenheimer · Post by **Jimmie Misenheimer** » 20 May 2004 8:08 pm

Should be plenty of $ to go around guys. We were playing at a country music hall, and in the same year were approached by both ASCAP and BMI. BOTH claimed to control 75% of the market. New math, or just "good old fashioned bullcrap"? - take your pick...

Jimmie

Nicholas Dedring · Post by **Nicholas Dedring** » 25 May 2004 9:01 am

A hula hoop, or an amplifier are not intellectual property. The law is that someone who writes a book, or a song, or makes a film, has the inherent right to make a claim on it, and to control it's distribution and performance.

Period.

Yeah, I don't pay Hartley Peavey every time I use an amp of his, but you better believe if I started making knockoff Peaveys I would hear from an attorney in a heartbeat, because the knockoffs would be a clear intellectual property violation of his patents...

If it weren't for IP rights, it would be harder for people to make a living developing new technologies, and harder for people to make a living at creative work... thus would be more difficult for you to have a job making records or writing or whatever else.

For what it's worth, according to the ASCAP site, a business just using the radio over speakers would not owe anything... and frankly for even a smaller business the idea of paying just over twenty dollars a month (actually $20.83) to play CDs and/or have performers making live music that covered BMI material just really doesn't seem like the big, extortion-style deal this is being hyped into.

Smiley Roberts · Post by **Smiley Roberts** » 26 May 2004 12:09 am

Throw in a beer and Smiley Roberts will appear in this thread too...

Yeah,but it would have to be a Beck's Dark! None o' that "light" crap.(Hey waitress,gimme annuder one,& dis time,compress da head,willya?!) No anchovies for me either. Those're them nasty little fish that smell like fingers.

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©¿© It don't mean a thang,
mm if it ain't got that twang.
www.ntsga.com</pre>

Tony Prior · Post by **Tony Prior** » 26 May 2004 5:40 am

BMI ..like any other Licensing agency makes there money telling you they are making money for you !
1 for you, 1,2 for me, 3 for you, 1,2,3,4 for me etc.....

688 million..thats a lot of Pizza's..but I just have to ask..Chicago or NY ?
RayBari's or Famous Original Rays ?

This is the important stuff..The Pizza guy who's gettin' sued..does he at least make a good Pie ? I mean..lets at least start at the beginning and get a reference..

Oh and Carl..you're smoking to much of the good stuff..too much sense..whats wrong with you brother?

t

Bill Llewellyn · Post by **Bill Llewellyn** » 26 May 2004 6:44 am

This is from the ASCAP site licensing FAQ. I stand corrected about the use of radios in businesses. <BLOCKQUOTE>quote:<HR>I'm interested in playing music in my restaurant or other business. I know that I need permission for live performances. Do I need permission if I am using only CD's, records, tapes, radio or TV?

Yes, you will need permission to play records or tapes in your establishment. Permission for radio and television transmissions in your business is not needed if the performance is by means of public communication of TV or radio transmissions by eating, drinking, retail or certain other establishments of a certain size which use a limited number of speakers or TVs, and if the reception is not further transmitted (for example, from one room to another) from the place in which it is received, and there is no admission charge. Your local ASCAP licensing manager can discuss your needs and advise how ASCAP can help you.<HR></BLOCKQUOTE>

Jim Cohen · Post by **Jim Cohen** » 26 May 2004 7:05 am

"I'm from ASCAP, and I'm here to help you..."

Alvin Blaine · Post by **Alvin Blaine** » 26 May 2004 7:17 am

For what it's worth, according to the ASCAP site, a business just using the radio over speakers would not owe anything.

From ASCAP site:

A food service or drinking establishment is eligible for the exemption if it (1) has less than 3750 gross square feet of space (in measuring the space, the amount of space used for customer parking only is always excludable); or (2) has 3750 gross square feet of space or more and (a) uses no more than 6 loudspeakers of which not more than 4 loudspeakers are located in any 1 room or adjoining outdoor space

and frankly for even a smaller business the idea of paying just over twenty dollars a month (actually $20.83) to play CDs and/or have performers making live music that covered BMI material just really doesn't seem like the big, extortion-style deal this is being hyped into.

The way that the restaurant is doing it now seems to be better for the artist that's getting their music played.
The pizza guy buys a CD of artist "X" and the writers of those songs get their royalties from the CD sell.

With the pizza place paying "just over twenty dollars a month" that would go into a BMI fund that gets divided up between artist "Y" and "X" and artist "Z" and who knows who. So now artist "X" is getting their music played in the restaurant, but artist "Y" is getting a check for it. That just doesn't make sense to me.

Also the pizza place is paying royalties when they buy the CD for $20 and now they have to pay over $20 a month to play it? There should be some kind of royalty tax exemption for people that pay monthly to BMI and ASCAP. If their going to pay into BMI for royalties to play the CD then why should they pay royalties on the purchase.

I think the whole BMI and ASCAP thing should be completely revamped. The way it is right now a club pays a fee for having music, but the artist and writers responsible for the music being played in the clubs, restaurants, bars, etc, aren't necessarily the ones getting the money.
From what I've read about it the money that BMI and ASCAP collect from annual business licensing fees goes into a fund that gets divided up according to radio play and unit sells.
So that means that if I play a gig doing Robert Earl Keen & Joe Ely songs then Mutt Lang & Shania Twain get paid for it. That's just not fair no matter how you look at it.

There should be some kind of a system set up so that the writers, responsible for the songs that actually get played, get paid.
I have no idea of how it should be fixed, but I do think it needs to be.

Tony Prior · Post by **Tony Prior** » 26 May 2004 7:36 am

Does it matter how far away the table you are eating your Pizza at is from the speaker or radio ? What if you can't hear it and they need to turn up the volume ?

What about a Juke Box at the all night Dinner ? You put $.50 in the Accordian looking chrome thing. Pay to play..who pays the royalty then ?

$20.80 does not seem like much..but for each establishment..every block, every street, every city..and like stated..artist X plays but artist Y+Z get the zing..thats seems a bit tilted..and what if artist X is playing his or her own self written music..back to the original topic on page 1....Artist Y and Z get paid for artist X to play his own self written tunes !!

"Cant' we all just get along"

Where's Rodney when ya need him most..

5 cents per gallon gas tax didn't seem like much 40 years ago either..It's for the Children..

ok..I'm done...........for now

Michael Johnstone · Post by **Michael Johnstone** » 26 May 2004 8:05 am

"With the pizza place paying "just over twenty dollars a month" that would go into a BMI fund that gets divided up between artist "Y" and "X" and artist "Z" and who knows who. So now artist "X" is getting their music played in the restaurant, but artist "Y" is getting a check for it. That just doesn't make sense to me."

It makes about as much sense as it CAN make considering that down at the pizzaria/nightclub level there's no way of keeping track of exactly which BMI music is getting played so averaging it out like that is the only way to do it.

Jukeboxes can electronically keep track of those details so that's theoretically more "fair" - but there's a lot of room for electronic manipulating(ala slot machines)book-cooking,payola and other skullduggery in that business because the last time I checked,it was largely run by the Mafia.
-MJ-

Nicholas Dedring · Post by **Nicholas Dedring** » 26 May 2004 8:23 am

For the jukebox question above...

there is a separate rate schedule for jukeboxes, and if you have one jukebox on the premises (the fee schedule gives a fluid volume discount; each additional machine reduces the per machine average cost substantially) you pay $371 per juke, I believe it's an annual charge, but I'm not
sure. This is the rate table: http://www.jukeboxlicense.com/JLO_Rate_Sheet_2004.htm

That makes a difference when you compare the cost of licensing for a small restaurant type venue...

I'm not saying BMI and ASCAP aren't fraught with problems... but when you mention that pop acts are getting most of the payout from it, it's partly because the only places that are consistently paying for public performance or broadcast rights are big venues, and radio stations; both of them play music by the laundry list of crappy commercial performers. If you could count the number of jukebox plays, or whatever, for smaller artists, they would receive a bigger portion of the money.

Yeah, I buy rights when I buy a CD, I buy the right to listen to it myself, or play within reason for a group of people. I don't own the right to broadcast it over the internet, or a pirate radio station or whatever else... the rights you buy are pretty specific; maybe I do the artist a favor by introducing them to people, but whether that's true or not is not considered by the general paramters of the licensing system... you don't pay for the right to do whatever you want with a record for a mere $20.[This message was edited by Nicholas Dedring on 26 May 2004 at 09:25 AM.]

Tony Prior · Post by **Tony Prior** » 26 May 2004 9:39 am

I guess the arguement is the one that gets back to this:

Will LIVE Music die..or should it die because BMI wants $20/mth from the Moose Lodge , American Legions , the Pizza parlors or the local Town Fairs where they have bands play for free every 2nd Saturday evening at the Town Center Green..

And

Does the guy who performs his own songs in Public still have to pay the BMI fee's so that Eminem, Brittany and Madonna can get there cash?

Seems like it's out of control to me..especially because if you buy any CD's and can't stand them due to poor performances or songs..you can't return them ! Now there's a monopoly...the fix is in..

How many of those recordings were purchased in good faith where the buyer pretty much got burn't..and had no recourse..or are they thinking everyone that purchased CD's loved 'em all to death..

Somewhere common sense should prevail..but never when cash is available..

"Money For nothin' and the Chicks for Free"

t

Alvin Blaine · Post by **Alvin Blaine** » 26 May 2004 9:39 am

Yeah, I buy rights when I buy a CD, I buy the right to listen to it myself, or play within reason for a group of people. I don't own the right to broadcast it over the internet, or a pirate radio station or whatever else..

Yes, I understand that when you buy CD it doesn't give you the right to play it for everyone.
What I was getting at is that if the pizza shop is paying the licensing fees then should they have to pay on the CD also.
Radio stations, DJ's, and most clubs all get promotion copies of CD's from the labels and don't pay for the music, except for licensing or broadcast fees.
So shouldn't the small business get promotion CD's if they have to pay licensing fees? Or can they already? Anybody know if labels will send out promo CD's to the corner dinner that wants to play music for their customers?