This is what it said in part on The Tote’s licence, until early 2011:

When live or recorded amplified music other than background music is provided:
• The licensee shall install and maintain a surveillance recording system able to clearly identify individuals, which shows time and date and provides continuous images of all entrances and exits, bars and entertainment/dance floor areas. The surveillance recording system must operate from 30 minutes before the start of the entertainment being provided, until 30 minutes after closure. A copy of the recorded images must be available upon request for immediate viewing or removal by the Victoria Police, or a person authorised in writing by the Director of Liquor Licensing, or otherwise retained for at least one month. The position of the cameras will be to the satisfaction of the Licensing Inspector.
• Signs, as described below, are to be displayed in all areas subject to camera surveillance. Such signs shall read:
"For the safety and security of patrons and staff this area is under electronic surveillance".
• All staff engaged in the serving of Liquor will complete a "Responsible Serving of Alcohol" training course, approved by the Director of Liquor Licensing within 2 months of this condition being imposed, or of commencing employment.
• Crowd controllers, licensed under the Private Security Act, are to be employed at a ratio of 2 crowd controllers for the first 100 patrons and 1 crowd controller for each additional 100 patrons or part thereof. One crowd controller is to be present outside the premises to monitor patrons arriving at and departing from the premises. Crowd controllers are to be present from 30 minutes before the start of the entertainment being provided, until 30 minutes after closure.

Why the "When live or recorded amplified music other than background music is provided" bit?

If there is potential for violence at a venue, how does having music make violence more likely? Couldn't music make violence less likely? Melbourne has a long history of fights at pubs where there was no music whatsoever.

The government's reasoning is that with live music or recorded music louder than background, bar staff would not be able to hear patrons speak clearly, so would not be able to tell if they were intoxicated. This, they say, could lead to a situation where there is violence, especially late at night, so a security guard needs to be employed (and that means 2 guards because of OHS) at pubs with late trading, if there's music.

The result is that pubs providing real music are under threat, while the clubs where the real violence occurs remain untouched.

Blanket conditions
One serious problem hotels have is that if they have a licence with conditions like the ones above, the conditions apply at all times. All hours and all days of the week.

So a quiet afternoon has the same conditions as a busy late night—the hotel has to employ security guards if musicians play on a Sunday afternoon and only their parents turn up. A quiet open mic night on Tuesday with water-drinking singer-songwriters has to have security guards.

I doubt that even Sue MacLellan intended that a quiet performance in the afternoon with 3 punters should have security guards. If this is the case, the fact that many venues have this condition in their licence says something about her competence.

Changes to capacity are also hurting venues with little or no history of violence.

From Fresh blow to music scene in The Age:

The Arthouse's manager, Melanie Bodiam, said Liquor Licensing Victoria had given the venue two options: close at 1am instead of 3am, or stay open until 3am at a reduced capacity of 90, instead of 300. She said both options were financially unworkable.

''Once our bands finish playing, musicians and patrons want to sit around, have a beer and a chat,'' she said. ''We don't want to have to usher them straight out the door.''

Changes to capacity have been made according to a formula… the lazy way.

The “recorded amplified music other than background music” includes jukeboxes. In 2009 a hotel was visited by individuals from the Compliance Directorate (the music police) and was told to turn the jukebox down.

Now it is in their licence that they are not allowed to have amplified music without security guards etc. I think it’s futile to complain about the law being enforced, but where is the common sense when it comes to making the law? Why is there a connection made in the first place between having this outrageous jukebox music and the liquor licence?

Music doesn’t cause violence.