Can a Business Legally Use Music as On-Hold Music?
Music on hold seems simple — until licensing enters the picture.
This guide explains how hold music licensing works, why consumer music sources are usually not allowed, and how to choose a solution that won’t create legal or operational headaches later.
Quick summary
Most businesses are unsure whether their current on-hold music is properly licensed for phone system use. This page explains why that uncertainty exists, what usually causes it, and the simple ways businesses typically resolve it.
Many businesses use music while callers are on hold, but fewer are certain whether the music they’re using is actually permitted for that purpose. This applies specifically to music played through business phone systems while callers are on hold or in call queues.
Streaming services, radio stations, purchased songs, and even “royalty-free” music are often licensed for personal or limited uses that don’t automatically extend to business phone systems. The key issue is whether the license explicitly permits use in telephony or phone system environments, because on-hold music is considered a form of public or commercial use, different rules can apply.
This page explains, in plain terms, how music licensing generally works for on-hold and call-queue systems, what common assumptions tend to get wrong, and how businesses typically handle this responsibly.
Not sure where your business stands?
Read the “On-hold Music Basics” section below to learn more. Or, if you want a quick way to decide whether a purpose-licensed on-hold music solution makes sense for your business, click the button.
On-hold Music Basics
Why is on-hold music treated differently?
When music is played through a business phone system, it isn’t considered private listening. The music is being transmitted to callers outside the organization, which places it in a different category than background music played at home or through personal devices.
In most cases, this means:
• The music is being used commercially
• The rights required are different from personal playback
• The source of the music matters, not just ownership
This is where confusion often begins.
What music sources do businesses commonly use, and where do issues arise?
Streaming services (Spotify, Apple Music, YouTube)
Consumer streaming services are licensed for personal, non-commercial use. Their terms typically do not grant permission to rebroadcast music through business phone systems, even if the account holder is paying for the service.
Using these platforms for on-hold music is a common practice, but it is also one of the most frequent areas of unintentional non-compliance.
Radio stations
Broadcast radio stations hold licenses to transmit music to listeners, but that license does not usually extend to businesses rebroadcasting the station through a phone system. Playing a radio feed as hold music is generally not covered.
Purchased music files (downloads, CDs, personal recordings)
Buying a song does not usually grant the right to publicly perform or transmit it in a commercial setting. Ownership of a file or disc is separate from the rights required to use that music for on-hold or call-queue purposes.
“Royalty-free” music
“Royalty-free” is a broad term that can mean different things depending on the license. Some royalty-free tracks allow use in videos or websites but do not explicitly cover phone systems or telephony use. The license terms matter more than the label.
Why does this become an operational problem for businesses?
For most businesses, the challenge isn’t just understanding licensing — it’s managing it.
Typical complications include:
• Unclear or incomplete license language
• Music supplied by phone vendors without explicit documentation
• Multiple tracks that must be selected, rotated, or maintained
• Staff changes that leave no one responsible for the setup
• Phone system upgrades that require re-uploading assets
Over time, music on hold becomes something businesses “set up once” without revisiting, even though the legal and operational details are rarely simple.
How do businesses usually handle on-hold music responsibly?
There are generally three approaches businesses take:
Use a managed or subscription service that provides licensed music and ongoing updates
Work with a provider that explicitly licenses music for phone system use
Choose a one-time, purpose-built solution designed specifically for on-hold playback
The right choice depends on the business’s tolerance for ongoing management, subscriptions, and internal complexity.
What matters most is that the licensing terms clearly cover on-hold and call-queue use, and that the solution fits how the business actually operates.
Why does simplicity matter for on-hold music?
Many compliant solutions focus on music selection and variety, which can require businesses to assemble or manage multiple tracks over time.
Other approaches prioritize operational simplicity — for example, providing a single, long-form audio file designed to loop cleanly, be uploaded once, and left alone.
For businesses that want to minimize administrative effort and avoid revisiting the issue, simplicity can be as important as licensing itself.
Where does ClearHold Audio fit into this?
ClearHold Audio was created for businesses that want a straightforward, compliant way to handle on-hold music without subscriptions, playlists, or ongoing management.
Each ClearHold track is:
• Professionally produced
• Licensed specifically for business phone systems
• Delivered as a single, long-form audio file
• Designed to be uploaded once and left in place
This approach isn’t for everyone, but it works well for organizations that value clarity, quality, and minimal maintenance.
Not sure where your business stands?
If you want a quick way to decide whether a purpose-licensed on-hold music solution makes sense for your business, the button below can help.