Music licensing can be seen in music we hear on the radio, in movies and on Television. For example if Cadbury Chocolates decided to use one of The Beatles songs for their new ad campaign, Cadbury would have to buy the rights to use that song from the owner of the copyright. When considering the licensing process from the perspective of a band or artist, licensing lets people use copyrighted material on other forms of media, which include radio, Television etc. While the owner of the copyright can get back money they have spent on creating the material.
The parties involved in the process include the music licensor and the licensee. The Licensor is the party that owns the copyrighted material, which could be for example an artist, a band or even a record company. The music licensee is the person who is given the rights to use the material in the media type specified in the agreement.
Music licensing is based on the fact that those who perform in a public place should get permission from the owner of the copyright. A public performance can be defined as a place where a performance occurs where people gather or where music is transmitted to the public. However, there are a few exemptions, which state that permission is not required for worship services that are not broadcasted or for performances used by educational institutions.
It would be impossible for songwriters, composers, music publishers and lyricists to monitor the hundreds and thousands of businesses that use music. Therefore, there are organisations like ASCAP and BMI that keep track of all copyrighted music performances and broadcasts.