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The $1.4 Billion ‘No-Brainer’ Opportunity The Music Industry Is Missing
Soundtrack founder Ola Sars says the US music industry is missing an estimated $1.4 billion in annual royalties because many businesses play copyrighted music without the licences required for commercial use. A study commissioned by the company suggests that clearer licensing and wider adoption of commercial music services could bring more businesses into compliance and create a new revenue source as growth in consumer streaming slows.
The study surveyed about 1,500 representatives covering roughly 15,000 US business locations. It found only 19% of businesses that play music are fully compliant; nearly 80% use personal streaming services, and just 5% hold licences from all four major performing rights organisations: ASCAP, BMI, GMR and SESAC. Soundtrack, which says it serves 60,000 businesses in 75 countries, offers a licensed service for about $35 a month and has recently partnered with SESAC.
In short
- Soundtrack estimates $1.4 billion in US royalties go uncollected each year.
- Only 19% of surveyed music-playing businesses were fully compliant.
- The company offers commercial music streaming for around $35 monthly.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Many businesses may be using personal streaming subscriptions that do not cover public performance, leaving creators and rights holders unpaid for music that helps set a commercial atmosphere. Clearer, simpler licensing and affordable business services could improve compliance, provide artists with another source of royalties as consumer streaming growth slows, and reduce uncertainty for businesses.
The case against
The estimate of $1.4 billion comes from a study commissioned by a company that sells commercial music services, so its assumptions and survey findings merit independent scrutiny. Businesses may also face a fragmented licensing system involving several rights organisations; expanding enforcement or adding fees without simplifying that system could increase costs and administrative burdens, particularly for small firms.
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