Did you know that SESAC is the only for-profit performance rights organization (PRO) in the U.S., and it’s been around for nearly a century? Established in 1930, SESAC is responsible for licensing and collecting royalties for some of the biggest names in the music industry. But how does it differ from its competitors like ASCAP and BMI? Let’s dive into everything you need to know about SESAC—what it stands for, how it functions, and why it’s such an important player in the music industry.
What Does SESAC Stand For?
SESAC stands for the Society of European Stage Authors and Composers, but don’t let the name fool you—it serves a global audience today. Initially created to help European composers get paid for performances of their work in the U.S., SESAC has since grown into one of the major PROs in the country.
Unlike other organizations like ASCAP and BMI, SESAC operates as a for-profit entity, which significantly impacts its structure and operations. SESAC takes pride in offering more personalized services to songwriters and publishers compared to its competitors.
The Importance of SESAC in the Music Industry
1. Music Licensing and Royalties
At its core, SESAC is about music licensing and making sure songwriters and composers get paid when their work is used publicly—whether it’s on the radio, television, in a concert, or streaming online. With music consumption growing across platforms, ensuring artists are compensated fairly is more crucial than ever.
In 2022 alone, PROs like SESAC collected over $2 billion in royalties, showcasing the immense financial significance of licensing to artists and creators.
2. SESAC’s Selective Membership
One key difference between SESAC and other PROs like ASCAP and BMI is that SESAC is invitation-only. This exclusivity allows SESAC to focus on a smaller group of high-quality songwriters and composers, offering them more personalized services. SESAC tends to work closely with its members to ensure they maximize their earnings from public performances.
SESAC’s Function in Music Licensing
How SESAC Licenses Music
When a song is publicly performed—whether at a live concert, on a streaming service, or in a restaurant—someone must pay for the right to play it. This is where SESAC comes in. They issue licenses to venues, broadcasters, and digital platforms, which allow these entities to legally use the music their members have created.
For example, radio stations or TV networks have to obtain a blanket license from SESAC to play their catalog of songs. The fees collected from these licenses are then distributed as royalties to SESAC’s member composers, songwriters, and publishers.
Role in Digital Streaming Platforms
With the rise of streaming platforms like Spotify, Apple Music, and YouTube, SESAC has adapted its model to ensure its members are compensated for every stream. SESAC works with digital platforms to negotiate licensing agreements that cover both large-scale streaming and niche digital markets.
How SESAC Handles Music Rights and Disputes
Ensuring Artists’ Rights
SESAC is committed to ensuring that songwriters, composers, and publishers are fairly compensated for the use of their music. This includes tracking public performances and collecting royalties, but it also involves protecting the intellectual property of its members. SESAC keeps track of where and when songs are played, ensuring no unauthorized usage goes unnoticed.
Dispute Resolution
SESAC offers legal support to its members to help them navigate disputes over royalties, licensing, or other issues. This includes working with venues, broadcasters, and digital platforms to resolve royalty disputes swiftly, often without needing to escalate to costly legal battles.
SESAC vs. ASCAP and BMI: How Do They Compare?
While SESAC, ASCAP, and BMI are all key players in the music licensing industry, they differ significantly in their structure and operations.
1. Membership
- SESAC: Invitation-only, making it more exclusive.
- ASCAP/BMI: Open to anyone, which gives them a larger membership base but less personalized services.
2. Profit Model
- SESAC: A for-profit organization, meaning it aims to generate revenue while serving its members.
- ASCAP/BMI: Both are non-profit organizations, distributing all the royalties collected after covering their operational costs.
3. Membership Size
- SESAC: Smaller, more selective membership base.
- ASCAP/BMI: Larger, with hundreds of thousands of members, making them more representative of a broader range of music creators.
4. Service Personalization
SESAC prides itself on offering personalized, one-on-one service, whereas ASCAP and BMI, due to their larger size, offer more standardized service to their vast number of members.
How Much Does SESAC Licensing Cost?
The cost of an SESAC license depends on various factors, including the type of business and how frequently the music will be played. For example, a small restaurant may pay less than a major broadcasting network.
On average, licensing costs with SESAC can range from hundreds to thousands of dollars annually, depending on the size and scope of the business. Since SESAC is a for-profit entity, it tends to negotiate pricing more flexibly, compared to ASCAP and BMI, which have more rigid fee structures.
Key Takeaways
- SESAC stands for the Society of European Stage Authors and Composers, focusing on personalized service for its exclusive members.
- It is the only for-profit PRO in the U.S., setting it apart from competitors like ASCAP and BMI.
- SESAC handles music licensing and ensures that its members are compensated for their work across various platforms, including live venues, TV, radio, and digital streaming.
- SESAC’s membership is invite-only, making it a more exclusive option compared to ASCAP and BMI, which are open to all songwriters.
- Licensing costs vary, with flexible pricing depending on the size and type of business seeking the license.
- Comparison with ASCAP and BMI reveals that SESAC is more selective and personalized, while ASCAP and BMI have broader, more standardized services due to their larger member bases.
Table: SESAC vs. ASCAP vs. BMI
| Feature | SESAC | ASCAP | BMI |
|---|---|---|---|
| Profit Model | For-Profit | Non-Profit | Non-Profit |
| Membership | Invitation-Only | Open to All | Open to All |
| Service Type | Personalized | Standardized | Standardized |
| Size | Smaller, Exclusive | Large, Open | Large, Open |
| Licensing Flexibility | Flexible Pricing | Standard Rates | Standard Rates |
Conclusions
SESAC plays a vital role in the music industry by ensuring that songwriters and composers receive fair compensation for their work. Whether you’re a venue owner looking for a music license or a songwriter hoping to maximize your royalties, understanding the nuances of SESAC can help you navigate the world of music rights more effectively.
FAQs
1. What does SESAC stand for?
SESAC stands for the Society of European Stage Authors and Composers, though it serves a global audience today.
2. How is SESAC different from ASCAP and BMI?
SESAC is a for-profit, invitation-only organization, offering more personalized services compared to the open, non-profit structures of ASCAP and BMI.
3. How much does a SESAC license cost?
Costs vary depending on the type of business and the frequency of music usage but typically range from hundreds to thousands of dollars annually.
4. Can anyone join SESAC?
No, SESAC membership is invitation-only, unlike ASCAP and BMI, which are open to all songwriters and composers.
5. Is SESAC involved in digital streaming royalties?
Yes, SESAC negotiates licensing agreements with streaming platforms like Spotify and Apple Music to ensure its members receive royalties from digital performances.