Music industry overreach?

I caught this article in the online edition of Australian newspaper "The Age" (via Digg, of course, I'm not a regular reader of Australian newspapers), wherein it discusses the raising of music licensing fees that are paid to artists and record labels by dance clubs and party promoters. From the article:

It lifted rates for recordings played in nightclubs from seven cents per person a night to $1.05 per person. The dance party rate rises from 20 cents to $3.07 per person.

Eyes subsequently pop out of one's head. I was not actually aware that club and party promoters had any obligation to pay licensing fees for the music they play. Hopefully, this is just an Australian thing, but any of you US-based club / party promoters out there, do inform me if that is equally the case in the United States (on that note, I know an LA DJ...maybe he would know what the rules are).

Charging for music played at parties and clubs seems to me just so mercenary.  To add insult to injury, the fees are leveled on a PER PERSON basis (that is, at big parties, you pay for everyone in attendance), which could quickly get very expensive for a large venue.

That seems awfully counterproductive. Multiple times, I've heard songs in clubs and bars and wanted to go out and pick up the CD at the store. That thought, however, provides a glimmer of rationale to underly a move that seems somewhat akin to a person wrapping a chord around his neck and choking himself for air.

Is this just another scramble by content companies to make money given the sinking sales of CDs, an event precipitated by growing levels of piracy, which itself was accelerated by the growing preponderance of digital music playback devices, such as the iPod, and the growing tendency to use and store music in digital form?

If that is the case, I'll have to mark down the music industry's newly expensive club shakedown racket as yet another harmful byproduct of piracy.  Even so, I question the benefit of this move to the industry.  Radios reach millions of listeners (potentially), so I can see some reason for broadcasting fees.  Clubs, however, serve a much smaller market, but they are unique in that they are a great venue through which to associate good things with your songs.  People are usually having fun at a club or party.

Music companies should WANT clubs to play as many of their songs as possible.  That means low, if not non-existent, licensing fees.

My apologies for slow blogging. I have been, to put it mildly, insanely busy.