The use of music in business operations is becoming more and more prominent in today’s society. Businesses are using music in many various ways, including as ‘on hold’ music for callers. This article looks at the potential copyright implications that may arise from such use of music in businesses.
The bottom line is that using music you have not created yourself nor hold a licence of use for is a copyright infringement for the purpose of on hold music as you are broadcasting the works to the public.i
There are two key questions that need answering in determining whether you are infringing the copyright in music by using it as on hold music
- Are you the original owner of the copyright in the music you’re using for the on hold music service?
- If not, do you have the relevant licences granting you the right to use such copyright?
If the answer is no to both of the above questions, it is recommended you seek our services to assist in acquiring the relevant licences for your business.
If your business is one that provides the service of on hold music to other businesses, it is important for you to consider if those businesses who receive your service should also acquire licences to use those copyrights. On the face of it, yes they should, and we recommend you instruct us to provide further advice on how you can incorporate providing this in your service.
COPYRIGHT IN MUSIC
Copyright in Australia is covered by the Copyright Act 1968 (Cth) (‘the Act’), which legislates the rights of copyright owners and their material.
Under the Act, copyright with respect to a musical work, is the exclusive right to:
(a) Reproduce the work in a material form;
(b) Publish the work;
(c) Perform the work in public;
(d) Communicate the work to the public;
(e) Make an adaptation of the work; and
(f) Do, in relation to an adaptation of the work, anything in relation to (a) – (d).ii
Copyright in music can be differentiated into two elements:
- The copyright in the song with respect to the composition or lyrics; and
- The copyright in the recorded version of the musical work.iii
Only the owner of the copyright material has the exclusive rights to use the material in the aforementioned ways, unless they licence that right to others.
OBTAINING THE RELEVANT LICENCES
When it comes to using music in the work place or business, there are two different licencing bodies who each grant licences for the rights to use these copyrights;
- Australian Performing Right Association Limited (APRA) issues licences for use of copyright with respect to the composition and/or lyrics of a song; and
- Phonographic Performance Company of Australia Limited (PPCA) issues licences for the use of copyright with respect to the recorded version of a musical work.iv
It is recommended that businesses acquire licences from both of these licencing bodies to avoid any potential copyright infringements. This is a service we can provide for your business to ensure the relevant and appropriate licences are chosen.
USING MUSIC AS ‘ON HOLD’ MUSIC
On hold music is the music or tune that is played on the telephone when your call is placed on hold. Many businesses have simple non-lyrical tones or pre-recorded advertisements; however it is becoming increasingly popular for businesses to use musical work to help keep their callers engaged.
The leading case law on copyright issues surrounding on hold music is Telstra Corporation Ltd v Australasian Performing Right Association Ltd (“Music on hold case”)  HCA 41; (1997) 191 CLR 140; (1997) 146 ALR 649; (1997) 71 ALJR 1312 (14 August 1997) (“Telstra Case”).
In this case APRA brought an action against Telstra for the use of music as the on hold music in various arms of their business. The music that Telstra was using varied from pre-recorded music to live radio broadcast.
It was found by the High Court that Telstra infringed section 31(1)(a)(iv) of the Act by ‘broadcasting’ the music to the ‘public’.
The act of broadcasting the music to callers satisfied section 25(1) of the Act and also the definition of ‘broadcast’ under section 10(1); ‘broadcast’ means to transmit by wireless telegraphy to the public.
The second element of this issue was whether or not Telstra was broadcasting to the ‘public’.
In determining whether or not the use of music on hold was in fact the act of broadcasting it to the public, three broad principles were considered:
- A performance was in public if it was not in private;
- The distinction between public and private stems from the nature of the audience in question; and
- The public is the copyright owner’s public.v
It was found that the act of using on hold music was an adjunct to the commercial nature of operating a telecommunications service.vi As Telstra was prepared to pay for the on hold music facility it only supported the commercial nature of the service.
Where music is broadcast in a commercial setting it is unlikely that is can be seen as being broadcast to a private or domestic audience,vii This reasoning was used when the court determined that Telstra had broadcast the music works to the public.
Regardless of if when a person is on hold they may be the only person privy to hear the broadcast of any music being played, as on hold music is generally used in the operations of a business, for the purposes of the Act, and in applying the findings of the Telstra case, it is likely any on hold music would be considered a commercial service that is being broadcast to the public.
To avoid infringing any copyright laws, business owners should ensure they have adequate licences in place that give them the right to use music in the operation of their business, including when callers are on hold.
If you are a business owner we encourage you to get in contact with us – we can assist you in assessing your position and ensuring your business is not infringing any copyrights.
This article is authored by Tessa Calver-James, Lawyer at MBA Lawyers.
i Telstra Corporation Ltd v Australasian Performing Right Association Ltd (“Music on hold case”)  HCA 41; (1997) 191 CLR 140; (1997) 146 ALR 649; (1997) 71 ALJR 1312 (14 August 1997).
ii Copyright Act 1968 (Cth) s 31(1)(a).
iii Phonographic Performance Company of Australia Limited, FAQ (2017) PPCA <http://www.ppca.com.au/music-users-/faq/#i-already-have-an-apra-licence-–-why-would-i-need-a-sound-recording-licence-/>
v Telstra Corporation Ltd v Australasian Performing Right Association Ltd (“Music on hold case”)  HCA 41; (1997) 191 CLR 140; (1997) 146 ALR 649; (1997) 71 ALJR 1312 (14 August 1997) .
vi Ibid [694-695].
vii Ibid .