The power of music in advertising is undeniable. For those of us who grew up in a particular age, iconic campaigns such as Guinness’s use of Leftfield’s ‘Phat Planet’ or Levis’ partnership with Mr Oizo’s ‘Flat Beat’ are etched in our collective memory, showing just how effective the right music can be in building brand identity.
Social media platforms offer brands a direct line to audiences, often with viral potential and even more often accompanied by the use of music. However, as the lines blur between personal and commercial use, brands are increasingly finding themselves in serious legal trouble for using music without the requisite licences. Although often these issues arise through mistake or ignorance, the consequences can be disastrous.
Music licensing in the social media age
On platforms such as TikTok, Instagram, and others, users can easily add music to their videos. Some social platforms have gone to great lengths – and secured and paid for hundreds, if not thousands, of licences – to obtain the appropriate rights from the music rights holders on behalf of users.
However, and critically for brands and commercial enterprises, the licensing agreements these platforms have in place typically cover personal, non-commercial use only. When brands, influencers or other professional users exploit music in a commercial context (such as in advertisements or sponsored content) without securing the appropriate commercial synchronization licences, they are infringing copyright. This gives rise to significant legal consequences.
When brands get it wrong
Several high-profile cases illustrate the point:
- Gymshark: This fitness apparel company faced a $44 million lawsuit from Sony Music for using Sony’s recordings across its social media channels without permission. The lawsuit involved both Gymshark’s official accounts and its influencers, with Sony alleging that the music played a crucial role in Gymshark’s success. The dispute was eventually settled, but almost certainly at a cost far exceeding what would have been required of Gymshark to secure the necessary licences.
- Bang Energy: This drinks company was sued by Universal Music Group (UMG) for using UMG’s music in over 140 TikTok advertisements without proper licences. Although Bang Energy claimed it believed TikTok’s user licence covered commercial use, the court ruled otherwise, highlighting the importance of understanding the limitations of music licences provided via social media platforms.
- Cosmetics industry: Companies such as Iconic London, OFRA Cosmetics and others in the sector have also been targeted by the music industry for similar infringements. Both were accused of using unlicensed music in their social media marketing, leading to lawsuits from major record labels.
- Marriott: The hotel giant has been recently sued in U.S. federal court by Sony Music for alleged ‘rampant’ infringement of almost 1,000 Sony recordings across social media posts by the hotel’s owned, managed or franchised businesses, as well as influencers paid by Marriott. The claim against Marriott amounts to a statutory damages exposure of almost $140 million.
These examples show that the infringement issue is not limited to a particular industry or product type. It is clearly a problem for brands across multiple industries. Unless music usage awareness and internal marketing practices change, we can expect to see many more claims being made against unwary or uninformed brands.
What brands need to know
To use popular music in an advertisement or other commercial messaging on social media, brands and professional users typically require two key licences:
- Synchronization licence (sync licence): This is required to pair a musical composition (i.e. the song) with visual content. It must be obtained from the copyright holder, which is usually the music publisher (although note that many European collective management organisations also purport to control some or all of these rights). To make things more complicated, a commercial song can often be co-owned by multiple copyright holders, which is why brands often partner with specialist music clearance agencies to obtain the necessary rights.
- Master use licence: This is needed if the brand wishes to use a specific recording of a song. It must be obtained from the owner of the recording – usually, a record label.
In addition, the social platform on which the advertisement or viral clip is posted should have its own performance or communication to the public licences.
Without these licences and apart from a very limited range of exceptions, the use of music in a commercial context is likely to constitute copyright infringement.
Platform licensing: Not a free pass
Many brands, marketing teams and influencers mistakenly believe that the music libraries provided by social media platforms are available for any use case, including commercial use. However, these licences are typically limited to personal, non-commercial use. This is because music companies want to see people enjoy their music and benefit from viral clips which are not being co-opted by a commercial brand (see, for example, the skateboarder Dogg Face who filmed himself gliding along to Fleetwood Mac, a clip that even the band promoted).
TikTok’s music terms of service, for example, explicitly state that “‘Sounds’ [being the library of commercial music available to users for selection in videos] are made available to individual users to include in their videos, so long as the videos are only for personal entertainment and non-commercial purposes”.
Despite the clear restrictions, the marketing teams within brands and many influencers continue to use platform-provided music in commercial content, either out of ignorance or in the hope that the infringement will go unnoticed while taking advantage of a viral trend. TikTok, in particular, has taken steps to mitigate this risk by restricting business accounts from accessing popular music through its ‘Sounds’ library. However, influencers chat online about how such restrictions can be easily bypassed (whether intentionally or not). Where brands take a chance in an effort to boost engagement though, they are exposed to infringement risk.
Solutions for brands
To avoid infringing music and getting into costly legal battles, brands should:
- Educate marketing teams: Ensure that all marketing personnel understand the risks associated with using unlicensed music. This should also extend to influencers that the brand engages. Typically, we recommend that marketing teams operate according to a strict internal social media copyright and compliance policy.
- Secure proper licences: While acquiring appropriate licences can seem costly, it’s far cheaper than the potential legal consequences. Licensing agencies and (yes, we know…) music lawyers can assist in this process.
- Leverage production music libraries: TikTok, SoundCloud, YouTube and other platforms offer production music libraries. Although these libraries typically do not extend to ‘trending’ or popular music, they carry far less risk.
- Commission new music: Though likely not the most cost-efficient option, commissioned music can be a great way for a brand to obtain a fresh and bespoke sound for their marketing without the risk of an infringement claim.
- Work with labels and publishers: The irony is that many labels and publishers really want to see their music go viral, especially new artists. There are opportunities for established brands to build symbiotic relationships with rights holders, rather than have battles in court.
The future of music licensing on social media
As social media continues to dominate the advertising and media landscape, the demand for music in short-form content will only grow. Brands need to be proactive in securing the necessary licences to avoid legal repercussions.
The music industry’s recent successes in litigation indicate that record labels will continue to enforce their rights in a robust fashion, particularly as the value of sync licensing continues to be challenged. You can also be sure that music publishers have been watching this play out and are waiting for the right time to bring their own claims against brands.
On a more positive note, executives at both social media companies and labels have publicly noted that if platforms can partner effectively with rights holders, the potential for growth in ad hoc sync revenues is substantial. But meantime, as advertising on social media evolves, so too will the need for music licensing agreements. Brands that fail to take the proper advice may find themselves facing significant financial and reputational damage.
Client Alert 2024-186
