It's gradually happening. Look at how many shops and restaurants today are playing cheap covers of recent hits rather than those recent hits themselves.
Cover versions still require public performance licenses.
Restaurants and bars typically pay for licenses from organizations like ASCAP and BMI, who distribute royalties to songwriters (rather than artists or record companies). Those licenses can cover recorded music playback and/or live music (usually with higher fees.)
However, streaming and satellite radio stations have their own license regimes, which may include royalties to artists and to record companies (for streaming at least). So a shift to cover versions (perhaps owned by the satellite or streaming network itself) could lower payments by the network, so that could provide motivation for cover versions.
Right. I think it's probably Spotify or equivalent somehow nudging them onto playlists of cover versions that are cheaper for them rather than the shops and restaurants explicitly making the choice. But it's a trend I've noticed that I thought was interesting, and suggests that cost is having an effect at some point in the chain.
Is this really the case? I'm a big fan of covers, and from what I've heard, nearly all of them share revenue with the original copyright holder. Except Hotel California - nobody is allowed to cover anything by the Eagles.
The Eagles have no say in the matter. Anyone in the US can legally record or perform cover songs as long as they pay government-defined statutory licensing fees.
