ASCAP and BMI take the royalties from public performances (radio and streaming into companies that sell services like MUZAK etc) and takes their cut then gives money to the artists. Individual streaming users are also considered public but are paid at different rate. When a CD gets sold the artist gets paid once.
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So what is a ‘public performance,’ exactly? It’s fairly simple: a public performance occurs when a song is played in front of a substantial group of people. This includes recordings of songs, or live performances of them, at places like malls, elevators, bowling alleys, restaurants, and sporting events.
Every time that occurs, a royalty needs to be paid to the copyright owners of the music played.
A radio broadcast, either traditional or digital, also constitutes a public performance even though the listeners are geographically dispersed. Essentially, a large crowd is listening at the same time, just not in one place.
In total, this adds up to a lot of money. In the United States alone, more than $3 billion of revenue is generated by public performances alone! That includes collections from airports to Pandora, radio stations to cafes — it’s a very long list, and all of it generates revenue.
Please note that a public performance is not occurring when only one person is listening (for example, to an mp3 download through headphones or a vinyl record at home). Similarly, a small gathering of family members or acquaintances does not merit a public performance.
Streaming on Spotify does count as a public performance, for a series of complex reasons (and litigations) that go beyond this comparison. Just know that you should be getting a publishing performance sights organization (PRO) check from Spotify (and other streaming service) streams, though in general, those payouts are extremely low when compared to other mediums (like terrestrial radio and TV).
Generally, those who publicly perform music obtain permission from the owner of the music or their representative."
There is so much mis-information on this subject. I am not sure how much people think that a 50 year old song streaming on Spotify should pay to an artist or artist's estate per performance. If I play a 50 year old album or 45 rpm record they get nothing. If I stream that same song at least they get something. Art museums dont pay royalties to the estate of dead artists when people go to see that artists' paintings or sculptures. Maybe they should but they don't.
This issue is a lot more complicated that most realize.