Using music in commercials is not as simple as just paying your ASCAP, BMI and SESAC royalties. While many broadcasters think that paying these royalties is enough to give them the rights to do anything they want with music on their stations, it does not. The payments to these Performing Rights Organizations (PROs) only cover the right to publicly perform music, i.e. to broadcast it. They do not give you the right to take the music and "synchronize" it with other words or video material, e.g. you cannot put music in a recorded commercial or otherwise permanently fix it into a recorded audio or video production. Instead, to make such a production, the producer needs to get the rights to both the underlying musical composition (the words and musical notes) and, if you are planning to use a particular recording of a song, the rights to use that particular recording ( the "sound recording" or "master recording"). Getting these rights may very well require that you deal both with the record company or performing artist whose recording you plan to use, and the publishing company that represents the composer of the music. And, as some artists may have concerns about having their music used to pitch some products, getting the rights to that artist’s version of a particular song may not be easy.
Even using the tune of a familiar song in an advertisement, with different words, is not permitted without getting the rights to do so from the publishing company. A copyright holder in a musical composition has the right to prepare "derivative works" of that composition. A derivative work is one that uses the original copyrighted material, but changes it somehow – like putting new words to an old tune. Many think that "fair use" permits the making of a parody of a song, so they are allowed to use the tune as long as they produce a new version that is funny. However, in the copyright world, fair use is not that simple. A parody, to allow use of the original tune, must be making commentary or criticism of the original song. Being independently funny or amusing, or otherwise dealing with some independent social or political issue, does not give you the right to use the music without securing permission from the composer of the music first. A recent story in the Hollywood reporter’s legal blog, THR,esq.com, told the story of a Congressional candidate, Joe Walsh, who thought that it would be cute to use the music of former Eagle Joe Walsh, to make fun of Democratic politicians. As set out in that story, Eagle Joe Walsh’s attorney did not find the campaign song very funny, and sent a very strong letter objecting to that use (the LA Times site had at one point had a link to a video of a band playing the candidate’s version of the Joe Walsh song "Walk Away", but it now says that the video has been taken down due to a copyright objection). Don’t let your station be the recipient of such a letter – get the rights to use music in commercials or other productions.
Even the use of music in "live" programming, which would typically be covered by the public performance right, can lead to problems in this digital age where content is regularly repurposed. We have seen cases in the last year where producers of live television programs that include the use of some music have been sued by the holders of copyrights in that music. Why isn’t this covered by the ASCAP, BMI and SESAC royalties? Because these programs are often recorded, and then rebroadcast as re-runs on the station. Or they are recorded and made available for downloading or on-demand streaming on the website of a station or program producer. The copyright holder in both the musical work and the master recording has an exclusive right under the copyright law to license the reproduction (i.e. the duplication or copying) of the work. So, when the work is duplicated on the tape used for the broadcast of a re-run of a "live" program, or where excerpts are copied on servers or other digital storage devices for on-demand playback on a website or through some other digital playback mechanism, the reproduction right is triggered. Thus, program producers need to get the rights for these uses.
There is commercial production music available for these purposes, where rights are pre-cleared. Also, it is often possible to get the rights to the musical work, and have that work recorded by a local band to avoid having to get the master rights from a popular band. But whether you are using production music or locally recorded music, be sure you know what rights you are getting, and what rights you need for the purpose to which you are putting the music, to avoid running into trouble.
Look for the Davis Wright Tremaine Guide to Music Law Basics, to be available very soon.