Why regular music on your phone line is not automatically allowed
Playing music to your callers counts as business use of music. In the US, the composer's and publisher's performance rights are collected by performing rights organizations, mainly ASCAP, BMI, SESAC and GMR; for regular repertoire you generally need a licence from whichever of these represents the work. Whether a separate fee also applies for the sound recording itself depends on how the music reaches your phone system; to the best of our knowledge this is not something we can state in general terms, so it is worth confirming with the relevant organization for your specific setup. This section is background information, not legal advice.
What about streaming services?
A consumer streaming subscription is for personal use. The terms of those services do not permit business use, such as playing music to customers or callers. That is separate from the performance-rights question: they are two distinct problems and you would need to solve both.
"Royalty-free" does not automatically mean free of performance-rights fees
Many vendors sell "royalty-free" music. Be aware that this term usually only covers the purchase licence. If the composer or publisher is affiliated with a performing rights organization anywhere in the world, that organization can still be owed a fee for public performance, whatever the vendor promises. So always ask a vendor who composed the music and whether they are affiliated with ASCAP, BMI, SESAC, GMR or an equivalent organization elsewhere.
How Meldstem solves this
Our hold music uses only tracks by a composer who is deliberately not affiliated with any performing rights organization and who released his work under the CC0 licence (a full waiver of rights). For each track we record origin, composer and licence in an evidence file, and every download includes a rights statement per track. To the best of our knowledge no ASCAP, BMI, SESAC or GMR fee applies to these tracks; the file is available on request. Nobody can give you an absolute indemnity, so neither do we, but you will be holding evidence.