OP-ED; PAYOLA'S OFFICIAL END

Payola Sees an Official End

Agreements were made between broadcasters of four major radio broadcasters and the Federal Communications Commission (FCC) over a scandal that has wracked the industry for years. That scandal is payola, and its influence over radio stations. This scandal was so widespread that it required action first by former New York State Attorney General Eliot Spitzer before the FCC would step in.

Payola is the practice of record companies paying money for the broadcast of records on music radio. It is illegal in the United States, but according to the U.S. Code Title 47, Chapter 5, “In any case where a report (payment) has been made to a radio station… an appropriate announcement shall be made by such radio station.” This means full disclosure of the sponsorship by labels for radio stations, and that the play of the song cannot be recorded as a “spin,” or play, on air for reporting purposes.

Record labels were Spitzer’s primary target while in the Attorney General’s office. The “Big Four” —Universal Music Group, Sony BMG Music Entertainment, the EMI Group and the Warner Music Group — signed settlements out of court totaling more than $30 million to stop the practice. CBS Radio and Entercom, two companies that settled with the FCC Monday, also settled cases with Mr. Spitzer’s office for a combined $6.25 million.

Clear Channel Communications, CBS Radio, Entercom Communications and Citadel Broadcasting all signed an agreement to pay a total of $12.5 million to the FCC in fines for accepting bribes, gifts and entitlements for playing songs on their radio stations. These companies are the largest radio station owners in the nation, which means they have a tremendous influence over the flow of musical content across the country. All the companies also signed a separate agreement pledging to play music from artists not signed to the four major record labels.

The companies would accept bribes through a loophole in the U.S. Code, which allows for the use of “indies,” or independent promoters (not to be confused with independent record labels,) to accept funds on behalf of the broadcaster, enabling them to still accept payment without having to disclose sponsorship. The “indies” would funnel the money to broadcasters, and “General Managers” would choose playlists, not the deejays themselves. This deal will purportedly stop that practice.

The broadcasters, of course, love the deal. They can now claim that both the scandal is behind them and that no explicit violations were found, just as Andrew W. Levin, Clear Channel’s executive vice president and chief legal officer did. In essence, they save face while the practice continues unabated.

As much as the big broadcasters love the deal, the independent labels, and those that lobby on their behalf, hate it. The agreement, which they signed, requires that the radio companies will broadcast the equivalent of 8,400 half-hour segments of music from independent artists between 6 a.m. and midnight any time of the week during the year. However, they see the deal as insufficient, feeling as if it is insignificant punishment for meta-conglomerates that will continue to shut independent voices out.

Payola dates back to the beginning of rock and roll. Alan Freed, an early disc jockey, and the man who coined the term “rock and roll,” saw his career end because of payola. Dick Clark avoided scandal by cooperating with authorities and selling his stake in a record company. Why would things change now?

The Recording Industry Association of America (RIAA) works in concert with these labels and broadcasters to enforce a landscape in which independent thoughts, ideas or actions are shut out and shut down. The RIAA has recently accused a highly promoted mix-tape artist, one touted by many hip-hop acts and used by major labels, of copyright infringement. DJ Drama was arrested late in the afternoon of Jan. 16 by a SWAT team from the Fulton County Sheriff's Office. They came with a warrant on the grounds that they had violated the state's Racketeer Influenced and Corrupt Organizations law, or RICO, a charge often used to lock up people who make a business of selling drugs or breaking people's arms to extort money, according to the February 18, 2007 New York Times.

Recently, the RIAA has targeted college students for illegally downloading music, which they claim is a dire threat to the business of record companies. The industry should be more concerned with the decrease of compact disc sales because of legal downloading from services such as iTunes, which has seen a huge jump in sales, especially in the form of single tracks, as opposed to full-length records. By preoccupying itself with petty scandals of downloading by students in their pajamas in their dormrooms, the record companies are missing the ball on a huge opportunity, and a potential boon for business.

All of this comes back to a couple simple facts: music is nothing more than organized sound, and to prosecute for the infringement of acquiring sound is ridiculous. To accept payment for specific songs is a form of propaganda; claiming that only certain songs are fit for play is just plain idiotic. But the control of the minds of the nation is at stake! Don’t allow for a few companies, and their zealous executives, to tell you what you should and shouldn’t listen to. Ask questions, demand answers and get music by any means necessary.