Learn about ASCAP, BMI, and SESAC, what these performing rights organizations or PROs actually do, and why or if you should join.
September 16, 2019
If you're songwriter, music creator, or music artist, you've probably seen and heard about the organizations ASCAP, BMI, and SESAC. You've also probably been told that you should join one of these organizations. As an entertainment and music attorney and artist manager, I'm often asked by new and potential clients what these organizations do and why they need to or should join one.
The organizations ASCAP, BMI, and SESAC are the three performing rights organizations in the United States. These organizations play a vital role in the careers of all songwriters, both financially and as advocates. These performing rights organizations, are often referred to as PROs in the U.S. and North America.
What do performing rights organizations ASCAP, BMI, and SESAC do and how do they help songwriters or music creators?
The PROs primary activity and way they help support songwriters, is by collecting performance royalties for songwriters and paying them out. These performance royalties are earned when creative works are performed "publicly". A public performance of a song includes when a song is played on the radio, including internet and traditional terrestrial AM/FM radio, on TV, in a bar or restaurant, or when performed at a concert or other live music venue or event. Radio stations, TV broadcasts, bars, restaurants, concert and live music venues pay various fees to the performing rights organizations ASCAP, BMI, and SESAC, usually either a flat licensing fee or based on a percentage of their revenues.
When songs are performed publicly, those performances are reported and logged with the PRO, either manually by the venue, establishment, performer, or broadcaster, or through automated tracking methods and technology using metadata. The PROs then pay their member songwriters a portion of these fees received based on which of their member's songs were publicly performed the most and the audience's size at the time of the performance.
In addition to collecting and paying public performance royalties, once a member songwriter has had some success, the performing rights organizations will sometimes loan or advance their member songwriter money. This money is often recoupable against the songwriter's future unearned or uncollected public performance royalties and is often used by the songwriter to invest or re-invest in the songwriter's music projects or career, purchase a home or vehicle, or more.
In addition to collecting and paying songwriter's public performance royalties, the performing rights organizations in the U.S. are also advocates for songwriters rights. The PROs often testify before and lobby Congress and presidential administrations, and lobby and work wiht other industry players and organizations to push for higher songwriter royalties as well as copyright law and music industry reforms and updates in order to benefit songwriters and music creators.
ASCAP vs BMI vs SESAC: What's the difference and which PRO is best for you?
Now that you know why you should join a PRO and the benefits of membership, you may be wondering why not join all three performing rights organizations? However, songwriters can only be a member of one PRO at a time.
This is because the licenses issued by ASCAP, BMI, and SESAC to radio and TV broadcasters or stations and venues and establishments, are call blanket licenses. They enable the broadcaster, station, venue, or establishment to publicly perform any and all of each PRO's member's songs without having to seek permission for each song from each writer. As a result each PRO collects only its member's public performance royalties and pays them to the writer and the writer's publisher.
That means songwriters must choose to join one of ASCAP, BMI, or SESAC. So, which one should you choose? Well, first we need to understand the differences between the three PROs.
ASCAP, founded in 1914, is the oldest, and the second largest, performing rights organization in the U.S., representing over 700,000 members and 11 million songs and compositions. ASCAP is short for the American Society of Composers, Authors, and Publishers and is the only U.S. PRO founded and controlled by music composers, songwriters, and music publishers. ASCAP costs $50 to join for songwriters and a membership agreement is one year in length. ASCAP typically pays out public performance royalties to its members every 6 to 7 months.
BMI, short for Broadcast Music, Inc., is the largest PRO in the U.S. representing over 900,000 members and 14 million compositions and songs. BMI was founded in 1939 by broadcasters who were concerned with ASCAP's dominance and growing monopoly in the United States. Songwriters can join BMI for free at no charge and BMI membership agreement are for two years. BMI usually pays out public performance royalties to its members ever 5 to 6 months.
SESAC, originally called the Society of European Stage Authors and Composers, was founded in 1930. It is the smallest performing rights organization in the U.S. representing approximately 30,000 members and 400,000 songs or musical compositions. It's small size is by design, due to SESAC's selective nature of membership by invitation only, which typically requires some traction, clout, buzz, or success in the music industry. If you are invited to become a member of SESAC, like BMI, SESAC membership is free. SESAC pays public peformance royalties to its members about every 3 months for songs publicly performed in the prior or preceeding 3 month period, so June to September performances will usually be paid in December.
ASCAP, BMI, and SESAC all offer different but similar secondary membership benefits, like discounts on other music industry organization memberships or events, hotel and travel discounts, and more.
At the end of the day, there are very little differences between the three U.S. performing rights organizations, and one PRO is not necessarily "better" than the others. SESAC's small size and invitation-only membership structure may get a songwriter more personalized attention and support, but that only applies if you can get invited to joing. Regardless if you're enough of a successful or rising songwriter to attract a SESAC invitation, ASCAP and BMI will likely give you the same amount of personalized attention or support. At the end of the day, the most important issue isn't which PRO to join, but instead is that you need to join either ASCAP, BMI, or SESAC if you're a songwriter or music creator.
If you want any additional information on public performance royalties for songs, performing rights organizations ASCAP, BMI, or SESAC, and whether or how to join a PRO, or if you need assistance or advice with collecting your public performance royalties or joining a PRO, please contact us at The Fruitful Firm anytime.
Zach Scott Gainous is a entertainment and music business attorney and artist manager in Nashville, and the founder of Nashville entertainment and music law firm and artist management firm The Fruitful Firm. Zach regularly provides legal, business, and career expertise, advice and representation to clients in music, entertainment, sports, media, technology, and more, including songwriters, music creators, music artists and bands, and record producers.
Disclaimer: This article or post is not and should not be considered or used as a substitute for legal advice or the hiring of an attorney. You should always carefully seek out legal advice and representation from a qualified attorney to assist you with your legal matters and issues.