And if the band happens to do a cover of a commercial song? Nah. Couldn't take that chance. Better they don't play at all.
If he is truly interested in the next U2, he can hire original music bands only. There are TONS of bands DYING to play their original music and maybe be the next big thing. If that was this guy's true intent, he could open his venue at no cost to him. He doesn't because he wants to make money, which means give the audience what it wants, which is LICENSED music. If he can't make that profitable, thats his problem.