credit to playfuls.com
The FCC has managed to force four of the biggest radio companies in the US to renounce or limit the practice called "payola", which consists of accepting money, airline tickets, clothing and other gifts from major labels to play repeatedly certain songs by their artists, thus overlooking songs by independent music labels.
Payola was made illegal following a series of scandals in the late 1950s. Radio stations have to announce publicly any such arrangement. In 2005, music producer Sony BMG agreed to pay $10 million and Warner Music Group agreed to pay $5 million to settle allegations of offering payola to radio stations.
The four owners of radio stations are reportedly CBS Radio, Citadel Broadcasting, Clear Channel Communications and Entercom Communications. The Chicago Tribune reported their deal with the FCC includes 8,400 half-hour airtime segments to be allocated for local and lesser-known artists.
Peter Gordon, president of Thirsty Ear Recordings, who led the negotiations on behalf of the American a**ociation of Independent Music, told the Chicago Tribune: "There are plenty of empty gestures out there. This one has the reality of a number attached to it, which makes it all the more serious of a commitment and an extraordinary one."
"We're moving forward on a good-faith basis," he said to the Hollywood Reporter. "If there are flagrant abuses, there are always points of enforcement, but we're trying to work this out amongst ourselves and take it away from Big Brother."
The free airtime would be granted to companies not owned or controlled by the big four of the recording industry, Sony BMG Music Entertainment, Warner Music Group, Universal Music Group and EMI Group.
The radio companies also have to pay $12.5 million to settle payola complaints by the American a**ociation of Independent Music (A2IM). The FCC consent decree also calls for a payola hotline, which employees can call to report such cases.
A common form of payola is known as "pay for play," and consists of payments by the artist through his label in order to ensure his/her songs receive airtime. There were also situations when lavish prizes meant for listeners winded up going to station employees.
"This is the largest collective fine in the history of American broadcasting," said Jonathan S. Adelstein, one of the five members of the Federal Communications Commission, as quoted by WP. "It wipes payola off the radio dial."
Adelstein said Entercom Communications will pay $4 million in fines, followed by Clear Channel Communications ($3.5 million), CBS Radio ($3 million) and Citadel Broadcasting ($2 million).
"I think it's a real breakthrough in the battle to wipe payola off the airwaves," he said. "If you take payola out of radio then music gets heard on the basis of merit, not on the basis of who's got wads of cash backing the artist. That's likely to make radio fresher and restore its vitality."
Things may just change in the next 2 yrs. Radio wise.
