With news of the PPCA now seeking to extract unjustifiable amounts of money from cafe owners it is seems time to consider whether the approach taken by the Copyright Tribunal in setting rates is truly reflective of community attitudes, copyright law, and the benefit received by artists. Quoting from the article:
Buoyed by the nightclub ruling, the PPCA is now targeting eateries. It wants to increase licensing fees in a 120-seat restaurant to $19,344 a year — up from $125. Small cafes would be slugged with a 4729 per cent yearly increase from $124 to $5860.
The Copyright Tribunal does not give due weight to the fact that artists get a benefit from the exposure of their works to a public. This is especially the case where a cafe owner exercises no discretion in the selection of the material (eg they have the radio on allowing people to hear material selected by the operator of the radio station). It is arguable that the performer in these cases is receiving more benefit from the exposure of the material than the cafe operator is. Rather than increasing the amounts payable to cafe owners, it would perhaps be more equitable if the PPCA was paying cafe owners for this advertising. If Google adwords is anything to go by, at the rate of a dollar or two each.
Rather than trying to place a dying model on life support (ironically, by making it uneconomical), the Copyright Tribunal needs to realise that the market price for content is zero or near zero, but the cost of advertising is not. There needs to be more recognition of the cost currently incurred by platform providers (such as cafe) in subsidising artists through this free advertising. A more just system would have the PPCA and similar entities begin remunerating platform providers for this advertising.
Of course, the main good thing to come when rates are set out of kilter with community values is that there is more incentive for existing platform providers to employ artists directly.
Update:
Rachel Polanskis offered this misquote from Hunter S Thompson:
“The music business is a cruel and shallow money trench, a long plastic hallway where thieves and pimps run free, and good men die like dogs. There’s also a negative side.”
Brendan Scott's Weblog 
I like that concept. In other words, Cafes are promoting the music, just as any radio station. Therefore if the history of the music industry is anything to go by, (e.g.: wikipedia payolla entry) then your conclusion is logical, the music industry should pay cafes for every piece of music played.
However, as I understand it – that would not fall under the performance rights license.
So the situation exists where the cafe owners would be billing the publisher for advertising, and APRA would be billing the cafe for performing rights.
Sort of cancels each other out really.