A government push to enforce music royalty payments in cafés and restaurants has stirred resistance among business owners, some of whom have opted to switch off the music altogether rather than face mounting costs and legal risks.
At several Japanese eateries in Pamulang and Cipete, speakers that once played pop hits have gone quiet. The decision reflects owners’ refusal to pay annual royalties of Rp120,000 (US$7.50) per seat for commercial music playback, as required under Government Regulation No. 56/2021.
“As a restaurant owner, I feel burdened by royalty payments because there are already many other financial obligations, such as paying restaurant taxes to the government and staff salaries, which are also taxed. On top of that, restaurant income is uncertain, so being charged Rp120,000 per seat per year feels heavy,” one café owner who declined to be named told SUAR (8/6/2025).
"As a restaurant owner, I feel burdened by royalty payments because there are already many other financial obligations, such as paying restaurant taxes to the government and staff salaries, which are also taxed,” said the café owner who wished to remain anonymous.
The royalties, collected by the National Collective Management Organization (LMKN), are intended to compensate songwriters and musicians. But critics say the system lacks transparency and imposes an extra financial burden, especially as small businesses still recover from the pandemic.
Rather than risk penalties, some owners have found creative substitutes. One café replaced background playlists with radios and traditional games such as chess and congklak to entertain patrons, many of whom are students. Others lean on unique interior design to attract social media-savvy visitors.
“I don’t understand why royalty payments are only getting attention now. Previously, there was Spotify subscriptions, so how does the mechanism work? Can we use Spotify?” they asked.
They also highlighted the lack of socialization about this regulation, particularly regarding playing music from applications like Spotify.
They also highlighted the lack of awareness and outreach regarding this regulation, especially concerning the playback of music from applications like Spotify.
Before the royalty regulation was enforced, this restaurant owner played music for several important reasons, aimed at enhancing customer comfort and the restaurant’s atmosphere. According to them, music helps customers feel relaxed while dining and prevents them from feeling bored or restless while waiting for their orders.
Seeking Music Alternatives Through Innovation
Instead of continuing to play music with potential royalty costs, the restaurant owner sought alternative solutions to maintain a comfortable atmosphere for customers.
They adopted several innovations to attract visitors. One solution was playing the radio and music arrangements as a substitute for music that they considered not subject to royalty payments.
In addition, they provided various games for customers to encourage interaction among patrons.
“We also offer games such as card games, chess, and congklak because many of our customers and target market are university students,” they explained.
Another innovation involved leveraging the restaurant’s Japanese-themed interior. This unique interior design became an attraction in itself, especially for visitors who enjoy creating content for social media.
When asked about the effectiveness of these innovations, the restaurant owner replied, “Oh, very effective. It’s different, right? I also believe that customers will return because of the food quality, but these innovations enhance their experience while in the restaurant,” they said.
"I also believe that customers will continue to return because of the food quality, but these innovations enhance their experience while in the restaurant,” they said.
The issue gained traction after PT Mitra Bali Sukses, operator of the Mie Gacoan chain outside Java, was accused of copyright violations for failing to pay Rp7 billion in royalties.
I Gusti Ayu Sasih Ira, director of Mitra Bali Sukses, was named a suspect in a copyright violation case in July.
The Indonesian Hotel and Restaurant Association (PHRI) in West Nusa Tenggara advised members to stop playing music altogether if they cannot afford fees.
“If paying royalties feels burdensome, just don’t play songs so it won’t be a problem,” said PHRI NTB Chairperson Ni Ketut Wolini, as quoted by Antara.
It won’t cause bankruptcy
LMKN chair Dharma Oratmangun argued the rules simply enforce rights under Indonesia’s Copyright Law.
“Some people think paying royalties will bankrupt them. In fact, paying royalties protects creative industry players. The rates are set at the lowest level according to the national economic conditions,” he said, as quoted by Kompas TV (8/5/2025).
He explained that LMKN has also considered various factors. For example, micro, small, and medium enterprises (MSMEs) are given different, and naturally lower, calculations compared to restaurants. He added that LMKN does not calculate rates based on a full 365 days due to certain months, such as the fasting month.
Anang Hermansyah, an Indonesian singer, musician, songwriter, and music producer, explained that paying royalties for music played in cafés and restaurants is a right regulated and protected under Law No. 28 of 2014 on Copyright.
“Artists are only asking for their rights. The law explains copyrights, performing rights, mechanical rights, fixation rights, and other rights protected by law. We agree with that law,” he told SUAR (8/7/2025).
He added that songwriters are not just requesting their rights for the sake of it; these rights stem from the creative work and effort of the artists. According to him, songs used by others for commercial purposes contribute to the café or restaurant owners, so artists also deserve to benefit from their creations.
According to D’Masiv band vocalist Rian Ekky Pradipta, paying royalties is not a burden for business owners, but rather an appreciation for songwriters.
“The regulation has been clear and in place for a long time. For the past 11 years, many restaurants, cafés, malls, and stations have been paying royalties to LMKN,” Rian D’Masiv said, as quoted in Kompas TV (8/6/2025).
Finding a Solution That Isn’t Burdensome
According to the Minister of State Secretariat, Prasetyo Hadi, the government is aware of the controversy surrounding music royalty payments in cafés and restaurants. The government is currently working to find the best solution to address this issue.
“We are looking for a solution, the best possible one,” he said, as stated in a Presidential Secretariat release.
Prasetyo emphasized that the primary purpose of this regulation is to protect songwriters. He also mentioned that the government will continue socialization and dialogue with all relevant parties, including the Café and Restaurant Association and the National Collective Management Organization (LMKN). It is hoped that through this approach, a fair and balanced solution for all parties will be achieved.
Responding to this, Deputy Speaker of the Indonesian House of Representatives (DPR RI) Sufmi Dasco Ahmad urged the Ministry of Law and Human Rights (Kemenkum) to immediately formulate technical regulations that do not burden business owners while still protecting the economic rights of songwriters.
“The DPR RI is also monitoring the music industry, which has experienced some dynamics recently, and we have requested the Ministry of Law, which also oversees the Collective Management Organizations (LMKs), to establish regulations that are not burdensome,” Dasco said in a press statement received by the SUAR team.
According to Dasco, Commission X of DPR RI is currently discussing a revision of Law No. 28 of 2014 on Copyright. This revision is expected to provide legal clarity and a more transparent and accountable royalty management system.
“While waiting for the revision of the Copyright Law being carried out by the DPR, the government needs to create fair regulations,” he said.
Data from the National Collective Management Organization (LMKN) shows that in 2023, total royalty income reached more than Rp 150 billion, yet its distribution to songwriters remains under scrutiny. Currently, there are around 10 Collective Management Organizations (LMKs) operating in Indonesia tasked with collecting and distributing royalties from various types of song usage.
Data from the National Collective Management Organization (LMKN) shows that in 2023, total royalty revenue reached more than Rp 150 billion, yet its distribution to songwriters remains under scrutiny.
On the other hand, musicians and songwriters are demanding that their economic rights be fulfilled as regulated by law. They argue that playing their works without compensation amounts to legalized piracy.
Dasco emphasized that the technical regulations to be drafted by the government and LMKs must be fair and not create new conflicts between business owners and songwriters. “There must be a clear mechanism, transparency in tariff amounts, and complaint channels if violations occur on either side,” he said.
Dasco added that the DPR also hopes the revision of the Copyright Law will provide more detailed classifications of business establishments based on scale, so that royalty implementation can be more proportional.