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Old 05-23-2002, 03:58 PM
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Les Les is offline
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Default OT: LA Time article on labels vs. radio

We have discussions from time to time about the state of radio these days, so I thought this news item might be of interest to some of you. The labels and artists' unions seem to have decided to try to do something about it.

Los Angeles Times
May 23, 2002

Music Industry to Call for a Federal Probe of Radio Payola

By CHUCK PHILIPS, TIMES STAFF WRITER

Beset by surging promotion costs, the music industry is planning to call for a federal investigation into payola in the increasingly deregulated radio business.

Record companies and artist unions were busy Wednesday preparing a letter to Congress and the Federal Communications Commission, urging officials to probe questionable promotion practices by Clear Channel Communications Inc. and other powerful radio station chains and to drastically strengthen payola rules, which they contend are being violated regularly.

The letter, drafted by a coalition of trade groups including the Recording Industry Assn. of America, is expected to be released Friday and challenges the legality of such common practices in the music business as independent promotion. It's been 40 years since the enactment of the federal payola statute, which prohibits radio stations from accepting money for playing songs without disclosing that information to listeners. Record companies have gone to great lengths to avoid using such sponsorship tags, and independent record promoters have flourished since the 1980s.

A handful of promoters attempt to sidestep the federal anti-payola law by paying broadcasters annual fees they say are not tied to airplay of specific songs and then charging record labels when a song is added to a radio station's playlist.

Record executives have been complaining for years about the soaring cost of promoting records to radio through intermediaries. Since Congress deregulated the radio business in 1996, the industry has consolidated drastically, and Clear Channel now owns about 1,225 radio stations, or 10% of U.S. stations.

Record label executives complain that the payments to independent promoters have swelled to an estimated $150 million annually, sources said, but the labels' influence in getting new music on the air has weakened.

Clear Channel and Radio One Inc. infuriated record companies recently after announcing that record labels must use designated independent promoters to pitch songs to music programmers at their broadcast chains.

The record firms and various trade groups now want the government to probe the effect of radio consolidation on the music community and the listening public.

"We are deeply concerned about payola and payola-like practices, as well as the problems caused by radio station ownership consolidation... ," said the companies and unions in a confidential draft of the letter obtained by The Times late Wednesday. "New rules must be written by the FCC to prohibit payments to radio stations from 'independent promoters' unless such payments are announced."

The unprecedented action underscores a fundamental shift of power in the music business. A spate of mergers in recent years, the groups contend, has moved the balance of control from the music labels to the radio conglomerates, which have the clout to launch a song simultaneously in scores of markets across the
country--or to consign it to oblivion.

The letter was drafted by a coalition of groups, including the American Federation of Musicians, the American Federation of Television and Radio Artists and the Future of Music Coalition. None of the organizations could be reached for comment late Wednesday.

The draft letter asserts that recording artists and citizens have been hurt by deregulation of the radio business and calls on the FCC to better police the nation's broadcast giants, which it says have "failed to serve the public interest." In the last four decades, the FCC rarely has attempted to prosecute anyone for payola.

The coalition also is demanding that Congress be more vigilant in its oversight of the agency to "ensure that public interest is being upheld." Specifically, the letter calls on Congress to:

* Prohibit all payments to broadcast stations designed to influence radio playlists, even when such intent is subtle and disguised--especially payments made through independent promoters.

* Closely examine how vertical integration of ownership in broadcasting, concert promotion companies and entertainment venues decreases "fair market competition" for artists, nightclubs and concert promotion companies.

A large section of the letter focuses on the escalating power of Clear Channel, which besides owning the largest chain of radio stations also owns the largest concert company in the world.The letter also says that Clear Channel and other radio conglomerates have centralized station playlists, reducing the local flavor and limiting the diversity of music played on radio. It also alleges that Clear Channel uses its dominant position to force acts to play in its concert venues and at its radio station concerts. If music acts refuse to comply, the implication is that their songs could be blacklisted at Clear Channel stations, the group contends.

Clear Channel could not be reached for comment.
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Old 05-23-2002, 05:32 PM
jwd jwd is offline
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Angry I agree 110%

Quote:
The letter also says that Clear Channel and other radio conglomerates have centralized station playlists, reducing the local flavor and limiting the diversity of music played on radio.

I am so sick of the state of radio today. It is bland, monotonous, and very formulaic. Just recently I have turned to a "local" radio station, broadcasting out of a university where I live. I couldn't tell you half of the songs they play, but it is MUSIC to my ears, and just so refreshing to hear. I have given up on the big radio stations here (many who are owned by Clear Channel)!!


Thanks for posting the article Les.


Joe
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