Walk into any Starbucks or Gap and chances are you’ll hear music playing in the store. According to a new study from Soundtrack Your Brand, a business which offers legal streaming for businesses, only 17% of all stores surveyed are actually streaming legally.
By law, a business is not allowed to use personal streaming services when music is played to benefit a business, e.g., entice customers to enter or stay longer. The study surveyed nearly 5,000 businesses from the US and Europe and uncovered some shocking data.
As summarized by Billboard, “[…] 88 percent of small businesses [reported] they play music daily or at least 4-5 days per week, with 80.3 percent saying music is important to their business (of that, 42.8 percent noted it was very important). As such, 86 percent of business said they were willing to pay some amount for the music, but the study did not specify what exact price point businesses deemed most reasonable. Meanwhile, those that do pay for streaming are mostly technically paying for the wrong services — 83 percent (21.3 million) of small businesses who play background music use personal music services such as Spotify or Apple Music.”
When the data is extrapolated, out of an estimated 21.3 million businesses who play music globally, music rights holders miss out on around $2.65 billion annually.
Malintent is not always the culprit in these cases, either. Of those surveyed, over half didn’t know what they were doing was illegal. In the US, 71% of businesses believed the way they were playing music was legal.
“Lack of innovation has driven small businesses to choose consumer services, as they are far more accessible and easy-to-use than most business alternatives,” said Andreas Liffgarden, who used to run Spotify’s business development and is now co-founder and chairman of Soundtrack Your Brand, in a statement. “We need a new generation of B2B streaming services, attractive to business owners, that make sure music makers get fair compensation.”