The Filipino Society of Composers, Authors and Publishers Inc. (FILSCAP) is stepping up efforts to improve licensing compliance among businesses, positioning music royalties as a relatively small operating expense compared with the commercial value music can bring to customer-driven establishments.
FILSCAP is expanding its campaign beyond Metro Manila as it seeks to persuade restaurants, hotels, retail stores, malls and other businesses that publicly playing copyrighted music without authorization carries both legal and financial implications.
‘Music can help your business if you create the right music environment,’ FILSCAP General Manager Mark Thursday Alciso said during the ‘Music for Business Growth’ forum at Seda Ayala Center Cebu.
The push comes as the organization works to close what it sees as a persistent gap in awareness among businesses over the value and legal use of music.
Under the Philippines’ Intellectual Property Code, copyrighted music played publicly for commercial purposes requires authorization from the rights holders. ‘One song played without a license is already a copyright infringement,’ Alciso said.
FILSCAP acts as the intermediary between music creators and businesses, allowing rights holders to collectively license their works rather than negotiate individually with every establishment that uses their music.
The nonprofit organization, accredited by the Intellectual Property Office of the Philippines, represents about 1,900 Filipino members and has reciprocal agreements with 50 foreign societies. Through these arrangements, it can license more than 40 million local and international musical works.
The collective model is intended to reduce the cost and complexity of copyright administration on both sides. Individual composers and artists would have little practical ability to track every commercial venue using their work, while businesses would face an equally difficult task of identifying and negotiating with each rights holder.
‘The licensing is being done collectively through a society because it cannot be efficiently enforced directly or individually,’ FILSCAP said.
The Intellectual Property Code allows copyright owners to designate collective management organizations to administer and enforce their rights.
Alciso said the accreditation system also helps prevent a fragmented licensing environment in which businesses would have to secure permissions from multiple organizations.
Thailand, for example, has about 30 music societies, potentially requiring businesses to deal with several organizations when obtaining music licenses.
In the Philippines, FILSCAP’s fees vary according to the type and size of an establishment.
A retail store in Cebu with a selling area of 51 to 100 square meters pays an annual license fee of P7,018.67, or about P584 a month. That works out to less than P19.50 a day.
Restaurants outside Metro Manila with fewer than 50 seats that use recorded music pay about P10,634 annually, while establishments featuring live performances pay higher rates.
For concerts, FILSCAP charges 2.25 percent of net ticket sales after deductions for amusement taxes.
The organization is seeking to shift the discussion from licensing as an additional expense to licensing as part of the cost of doing business in an environment where music can influence customer behavior and shape the overall consumer experience.
While some business owners initially resist the fees, Alciso said many eventually consider the cost reasonable once measured against the role music plays in attracting and retaining customers.
The broader compliance campaign is being pursued with industry groups such as the Philippine Retailers Association and the Kapisanan ng mga Brodkaster ng Pilipinas, with preferential rates being offered to some sectors to encourage wider adoption.
For music creators, the system provides a mechanism for collecting royalties from commercial users at scale and distributing the proceeds to rights holders.
FILSCAP said nearly all revenue generated from licensing is ultimately returned to rights holders, after deductions for operating expenses and socio-cultural projects.
As the Philippine services and retail sectors continue to compete increasingly on customer experience, FILSCAP is betting that businesses will come to view music not merely as background entertainment – but as a commercial asset whose use carries a corresponding cost to its creators.