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Has The Time Come For A Simple Karaoke Operator's License?

Discuss any legal issues pertaining to karaoke.
The Lone Ranger
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Has The Time Come For A Simple Karaoke Operator's License?

Post by The Lone Ranger » Thu Mar 19, 2015 9:16 am

I have recently posted on this forum about the ASCAP attempt to have Congress rewrite our antiquated copyright laws. With particular attention to the revamping of the 74 year old consent decree. SC calls it's new approach an operator's license. Which is not a new idea. In England they call it a pub license. Under the legislation ASCAP is pushing all you would need is a license for the copyrighted material you use in your particular commercial situation.

I proposed a similar solution years ago, and most legal hosts opposed the idea, since it would not punish the pirate operators, and give everyone a chance to participate equally in the market. The reality is the pirates are operating anyway and are not paying into to the system at all. It's ironic that the very system I suggested as now been adopted by SC, or should I say Phoenix LLC. Of course their operator's license is more expensive and only covers their product. Really what it covers is SC aka Phoenix will not sue you, you can still be sued by the copyright holders if they decide to take you to court.

There are still myths floated about concerning the quality of shows pirate v.s legal. Just because a host can run his operation by carefully managing costs, and offer his service at a cheaper rate does not mean he is a pirate. Nor is it true that pirates have inferior equipment or hosting skills. Of course there are bad hosts both pirate and legal. It is true that while the pirate has an unfair advantage over the legal host as far as cost getting his content, That advantage lessens if the host doesn't have the necessary skills to use the material to the fullest advantage.


For too long I think the karaoke community has been focused on the library, where it came from, how it was acquired? It wasn't really an issue until piracy saw the explosion of hosts on the karaoke scene. The reason it became an issue was that the producers could not make a profit any longer, and the hosts could not get their 300.00+400.00 a night fees.

The reality is that the genie has been let out of the bottle. For six years only two companies have tried to put the stopper back on. Both SC and CB have turned over the legal battle to two new LLC/s. In both cases their solution is to buy a product from them and they will go away sort of protection money. You either join Cloud for CB/DTE, or obtain an operator's license in the case of SC/Phoenix. This in itself is an admission that the legal process they had started has failed. By their own figures the number of hosts had gone up 10% during their efforts, and they settled less than 2% of the estimated hosts in the USA. That means they are farther in the hole than when they started.

I think the time as come for everyone concerned with this karaoke industry to accept the fact that getting rid of pirates with the current approach will not work. The only option which makes sense is to have every host working have a universal operator's license, which they have to pay to maintain on a yearly basis. This will give them the right to use the copyrighted material in their particular commercial enterprise. This will insure that everyone will be paying for the use of that material.



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Post by DanG2006 » Sat Mar 21, 2015 1:15 pm

Pirates aren't gonna pay the license. heck unless I end up working seven nights a week, I might not pay the license. the license is gonna kill the single op that can barely get their feet in the door because too many pirates are hogging all the shows.

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Post by The Lone Ranger » Sat Mar 21, 2015 4:42 pm

8) When I was hosting Dan even I didn't work seven days a week, I took Sunday off. Even God had to rest. I think pirates will pay for the license if they need one to work at all. It depends if the need for a license is enforced. That is what the problem has been with present legal approach only two companies even tried to use it. All a host had to do is to stay away from two labels, that still left a mountain of material. After six years of the legal process less than 2% of the estimated hosts have settled with SC or CB related companies. That means there is a better than 98% chance they could operate the last six years without any real problems.

All the license will do is allow the host to operate his or her business without the threat of being taken to court. Just like a fishing license does not mean you will catch fish, it only allows you to fish legally. Whether a host is successful depends on his or her skill level. If you want to work 7 days a week Danny you really have to want it. You are the host that is expecting 50.00 an hour for a gig. If you are worth it you can make that much. The trick is convincing the venue owner you are worth it.

In the present real world a host can expect to earn somewhere between 25.00 to 37.50 per hour. For a four hour gig that comes to 100.00 to 150.00 per night plus tips. If you worked six days a week at 150.00 for four hours in one year you could make 46,950.00 plus tips. There is money to be made still in this industry, it is just if you are not going to see the 300.00 to 400.00 per night hosts use to get, in the past. There is just too much competition, but if you are right and the pirates don't get a license, then eventually venues will stop hiring unlicensed hosts, the risk would just be too great. The cost is borne by the operator and can be deducted off his taxes, which he should be reporting anyway. If not then he is in trouble with the IRS, forget the publishers, then he has real problems.

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Post by wiseguy » Sat Mar 21, 2015 7:28 pm

We simply need to go back to the old system where the establishments are required to carry a "blanket" license to cover the entertainment.

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Post by The Lone Ranger » Sun Mar 22, 2015 8:09 pm

[quote="wiseguy"]We simply need to go back to the old system where the establishments are required to carry a "blanket" license to cover the entertainment.[/quote]


8) I used to think if a venue had a jukebox they had paid their fees and karaoke was covered as well. Other hosts have told me that is not the case, so it is rather confusing if karaoke is covered or not by the venue paying their fees? The jukebox is considered the main entertainment since it is there on site all the time. A band,DJ or a karaoke host is something that comes and goes.


Like many other situations karaoke is just a small piece of the overall entertainment mix. Since this is what we do, we tend to thing of it as a major player, which others don't really feel it is. You can see this when ASCAP articles don't really even mention the karaoke end of the business.

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Post by wiseguy » Sun Mar 22, 2015 8:31 pm

I owned a nightclub for a couple of years. I was required to purchase a license that covered the performing of recorded and live music. This covered everything from the jukebox to bands and of course karaoke.

Organizations like ASCAP and BMI are there to protect the song writers. The money they collect is distributed to the copyright holders of the songs. ASCAP doesn't mention karaoke because it is no different than any other form of music as far as they're concerned. I think BMI makes a brief mention of karaoke.

From what I've been hearing lately things are changing some. Now organizations like ASCAP and BMI are selling licenses to bars and clubs based on the amount of entertainment they provide. More songs performed = higher license fees. The "one price fits all" is no more.

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Post by The Lone Ranger » Mon Mar 23, 2015 8:53 am

8) It would seem to me wiseguy that if a karaoke operator's license is made available and it is needed the host should pay for it anyway. You can't be sure the venue you are playing for has paid all of it's fees. You would be exposing yourself needlessly to possible legal action, by simply plying your trade. It would seem from what I have read, that ASCAP at least wants the license to cover the particular commercial application the copyrighted material is being used for. I think an operator's license for karaoke should be around $50.00 a month $600.00 a year. If all of the over 50,000 estimated hosts were required to have a license this would bring in over 30 million dollars a year. Keeping in mind karaoke is around a 1 billion dollar slice of the entire entertainment industry pie.

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Post by wiseguy » Mon Mar 23, 2015 9:52 am

According the licensing agencies like ASCAP and BMI it is the responsibility of the venue to provide the proper license for the performance of copyright protected material. This means that the karaoke host cannot be held responsible if the venue fails to meet the requirements. I say to hell with this "karaoke operators license" concept. The fees collected from all the venues around the country amounts to many times that 30 million.

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Post by The Lone Ranger » Mon Mar 23, 2015 10:10 am

8) with all due respect wiseguy, just because "It is the responsibility of the venue". doesn't mean that the venue is taking it's responsibility to heart. When SC and CB sued they not only went after the venue but also the host. If the host cannot be held responsible then why have hundreds of hosts been sued? I don't doubt that the fees collected from all venues is many times more than 30 million. Not every venue offers karaoke, even fewer now since many have gone out of business, or have decided that karaoke is too risky in the present legal uncertain times.

It is this element of uncertainty that needs to be addressed. I don't feel that a specific license to run a business is unreasonable. Welders have to be certified, so do accountants, doctors require a license, as do other professions. If you really want to have hosting considered a profession and taken seriously why not have a license?

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Post by wiseguy » Mon Mar 23, 2015 11:22 am

You and I both know that the CB and SC suits were/are not about copyright issues. And what would this business license do to stop them from filing suits? Are they the ones who will collect the licensing fees? They are a private entity. ASCAP or BMI have never filed a suit against a karaoke host. The SC law suits can be avoided by simply not using their music.

The vast majority of venues have no idea about the karaoke legal issues. They have the major licensing agencies telling them they are covered... and they are. Worse case scenario if it was to become a concern is that they would just not hire KJs who play SC music. Problem solved.

Certifications required by some professions has nothing to do with it. We have too much bureaucracy now without adding to it needlessly. There is nothing to gain by requiring DJs and KJs to have a business license.

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Post by The Lone Ranger » Mon Mar 23, 2015 11:51 am

8) It is also true wiseguy that even if you do settle with CB/aka Piracy Recovery or SC/aka Phoenix, nothing prevents the original copyright holders from suing the host as well. The reason ASCAP or BMI has not sued a karaoke host, is they consider the venue the deep pockets. This situation could change if they feel the hosts are a source of revenue as yet untapped.

More venues have become aware of the karaoke legal issues, simply by being sued. True the amount that both CB and SC and their LLC's have recovered has not justified the expense involved if the suit goes to trial. That is why both the LLC's try to have you settle before a court hearing. The court has been awarding the fair retail value of the product in question, with no court fees. These settlements have been around $5,000.00 a piece both for the venue and the host in question. I totally agree with you that the best policy is not to use SC or CB if possible. That still does not eliminate the possibility that the publishers or copyright holders of the original material could sue you as well.

Actually the operator's license to cover karaoke cuts the bureaucracy that could be levied on a karaoke host. A nightmare scenario would be if other LLC's obtained the rights to other karaoke libraries the so called orphans. If this were to happen you could not use any materials without paying protection money to the various rights holders. It would make more sense to have one license to cover everyone, then the lawyers from the various companies could fight over their share of the fee collection pie. The license also makes it easier for the venue to determine if the host they are hiring will have a negative impact on their operation.

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Post by wiseguy » Mon Mar 23, 2015 9:33 pm

I don't think you understand just how mandatory it is for bars and clubs to carry the ASCAP and BMI licensing. In every state I know of this is a requirement when acquiring or renewing a liquor license. It is a certificate that must be displayed along with the liquor license. There is absolutely no logical reason to believe that these agencies will change policy and go after the DJs, KJs, and bands.

Explain to me how this business license would exempt anyone from the SC like law suits and any copycats that would follow. They are suing for trademark infringement. Do you think you will be able to come up with a business license that will cover this? Good luck with that.

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Post by The Lone Ranger » Tue Mar 24, 2015 9:22 am

8) Naturally wiseguy for this to work at all, ASCAP's plan for modernizing of the antiquated copyright laws would have to be enacted by Congress. There would have to be a major overhaul of the existing licensing procedures. Other countries have managed to get this right, I think that we can also. I don't feel it is illogical to think these agencies might not change policy. After all since the economic meltdown, and the crack down on drinking and driving, the number of bars and clubs have gone down. This idea of ASCAP's quite plainly wants to have a particular license for the commercial application your business is using the material for. This indicates to me their will be different fees for different applications. A producer of a mass product will probably pay more than a entertaining company providing a service for example. Oh by the way it might be mandatory for bars and clubs to carry ASCAP and BMI licensing, I have seen many posts where hosts say the club they are playing for had stopped paying, to cut business expenses?

The vehicle they keep mentioning to make this all work is licensing. Licensing like they have in England with the Pub License. Which is kind of a miss label. It is a license that an operator has to have to work in a Pub aka bar or club. The license would protect the host from being sued by various companies for trademark infringement, since the fees collected, would be paid out to those companies. Naturally how much they are reimbursed would depend on some formula probably worked out by the administrators of the licensing program.

When you look at the alternatives this would seem to me the best solution. I'm no longer in the business of hosting a nightly show. Once in a while I do a show for a friend who is sick, a license won't help me that much. For hosts that are playing in public often though it is a tough situation. You are trying to run a business, and you never know if you will be sued, lost time and wages. I think it is time to have more certainty. Remember according to most karaoke disc producers they never intended their product to be used in a commercial venture. That the use of the product in that manner is illegal, making anyone that is a host or has been one operating illegally all this time. At least the license will say yes you can use the product for your particular commercial enterprise.

The reality without a changes in the copyright laws this country will continue to fall behind the rest of the world. That without some type of licensing the Wild West situation of the karaoke hosting industry will continue. That a host is in danger of being sued for public performances, that according to the manufacturer's of the product it was never intended for commercial use in the first place. Something to think about.

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Re: Has The Time Come For A Simple Karaoke Operator's License?

Post by wiseguy » Thu Mar 26, 2015 1:37 am

So what happens if this business license idea goes into effect and the licensing agents decide to hike up the fee? The average small operator could find himself unable to afford to stay in business. You're not talking about a typical business license here. You're talking about a business license that also covers copyright fees.

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Re: Has The Time Come For A Simple Karaoke Operator's License?

Post by The Lone Ranger » Thu Mar 26, 2015 10:49 am

[quote="wiseguy"]So what happens if this business license idea goes into effect and the licensing agents decide to hike up the fee? The average small operator could find himself unable to afford to stay in business. You're not talking about a typical business license here. You're talking about a business license that also covers copyright fees.[/quote]

8) At least you only have to worry about one agency jacking up the license fee, if we keep with the current system that is evolving, with each company having it's own way of charging for the use of their product, it will cost more. Not to mention the host not being able to afford multiple costs will have to pick and choose which labels he wishes to carry. This means the shrinkage of material you will have available to your karaoke service. Not to mention each of these individual companies can jack up their fees anytime they want to as well. Whatever is charged for the license it can be written off your taxes as a business expense. This license will weed out the hosts that aren't earning enough to pay for a license, should they really be in business if they aren't making enough to pay for an operator's license? This will force many hobbyists to become professional. This leaves the profession for the true professionals.

Lord knows I don't agree with SC aka Phoenix LLC, but this time they did get something right. An operator's license to cover use of their product with no audit requirement. What they got wrong was it only covers their material and is too expensive since it only covers one brand. I don't think the British are smarter than we are and they have had the Pub license for some time now. It is not a perfect system but it does point the way in how to get one stop licensing working. Like Churchill said " The Americans will always do the right thing, but only after they have tried everything else". I think we can get this to work but we will have to do some thinking outside of the current box.

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