It seems to me that small bar owners will need a written contract with these bands to restrict what gets played. And bands that are thin on original and are using existing licensable music to show off their performance stuff will be more limited in where they can perform, only at places that can afford the standard performance license packages from the 3 agencies.
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It seems to me that the extortionists are going after the wrong people....if it is the artist that is playing the cover, then they should be the ones that get the bill supposedly they are making a bit of coin, even if it is just gas money, on the gig. It would be between the group and the venue to figure out the details of compensation, but the groups song list would be the proof. ASCAP needs to focus their investigation on the group that is actually playing the cover. This is the "information age" and it would not be that much of a paperwork burden to keep a database of songs played per group, and bill accordingly. ASCAP could even have different billing arraignments, Groups can acknowledge that they play mostly covers and pay a lower flat fee per song, or a group can pay "alacart" at a higher rate per song.
This would have the added benefit of fewer covers and more original music, or at least a hard look at whether or not the cover is worth the coin to play. Of course this would bring in realistic revenue which ASCAP may not want when they can shakedown...I mean bill for the POTENTIAL of some venue playing a cover.