Payola

Payola, in the American music industry, is the illegal practice of payment or other inducement by record companies for the broadcast of recordings on music radio, in which the song is presented as being part of the normal day's broadcast. Under U.S. law, , a radio station can play a specific song in exchange for money, but this must be disclosed on the air as being sponsored airtime, and that play of the song should not be counted as a "regular airplay."

The term has come to refer to any secret payment made to cast a product in a favorable light (such as obtaining positive reviews).

Some radio stations report spins of the newest and most popular songs to industry publications. The number of times the songs are played can influence the perceived popularity of a song.

The term Payola is a portmanteau from the words “pay� and “Victrola,� a trade name of early home music reproduction devices from RCA Victor. Payola has come to mean the payment of a bribe in commerce and in law to say or do a certain thing against the rules of law, but more specifically a commercial bribe. The FCC defines "Payola" as a violation of the sponsorship identification rule that recently resulted in tens of millions of dollars in fines to cable corporations in New York.

== History ==

"Payola, in one form or another, is as old as the music business." In earlier eras there wasn't much public scrutiny of the reasons songs became hits. The ad agencies which labored for NBC radio & TV show Your Hit Parade for 20 years refused to reveal the specific methods that were used to determine top hits. Attempts to create a code to stop payola were met with lukewarm appreciation by publishers. Hit radio was a threat to the wages of song-pluggers. Attempts were made to link all payola with rock and roll music.

The amount of money involved is largely unpublished; however, one deejay, Phil Lind of WAIT in Chicago disclosed in Congressional hearings that he had taken $22,000 to play a record.

Partially out of payola concerns, a very large majority of DJs are cut out of the song-picking decisions and are instead told, in the form of a playlist, what to play and when, by their superiors (who may include music directors, program directors, general managers, and even owners).

Third-party loophole

This newer type of payola was an attempt to sidestep FCC regulations. Since the independent intermediaries were the ones actually paying the stations, it was thought that their inducements did not fall under the "payola" rules, so a radio station need not report them as paid promotions.

Former New York State Attorney General Eliot Spitzer prosecuted payola-related crimes in his jurisdiction. His office settled out of court with Sony BMG Music Entertainment in July 2005, Warner Music Group in November 2005 and Universal Music Group in May 2006. The three conglomerates agreed to pay $10 million, $5 million, and $12 million respectively to New York State non-profit organizations that will fund music education and appreciation programs. EMI remains under investigation. The largest independent firm headed by Rick Hendrix of the Rick Hendrix Company was cleared of any wrong doings and became the only promoter reinstated with full rights.

Concern about contemporary forms of payola prompted an investigation during which the FCC established firmly that the "loophole" was still a violation of the law. In 2007, four companies (CBS Radio, Citadel, Clear Channel, and Entercom) settled on paying $12.5 million in fines and accepting tougher restrictions than the legal requirements for three years, although no company admitted any wrongdoing. Because of the increased legal scrutiny, some larger radio companies (including industry giant Clear Channel) now flatly refuse to have any contact with independent promoters.

"Pay to play" for live music

The promoter is usually looking to minimize the financial risk involved in putting on an unknown band by asking them to help ensure the cost of the event are covered somewhat by their own efforts, rather than leave it all to the promoter. This usually involves the band pre-selling tickets, publicising the event etc. In return they get a platform for their artistry. As a band builds a following the risks are diminished.

In rock and metal music, some clubs and bars ask some bands to pay to perform. Metal/rock drummer Richie Rivera states that the best clubs to play "...are usually pay-to-play (or what the clubs call 'pre-selling tickets')". Rivera says that while his band has done "pay to play" to perform at venues, in the future, the band will "...only do it for a support slot for a national act."

Jazz trumpeter Marvin Stamm has described a similar "pay to play" issue in New York city jazz clubs. Stamm says that if a jazz "...artist or group is new or unknown, some clubs - even the larger clubs - will ask that the artist or group’s record company guarantee that the club will break even. If there is no record company to back the artist, then he will probably have to guarantee this himself." If there is a poor turnout at the club, the jazz band leader may have to pay hundreds of dollars to the club.

In the US, there are "pay-to-play" "Battle of the Bands" contests where bands pay to perform on stage. Billboard Magazine's Oct. 21, 2006 article "Pay to Get Played" described how a "third-party booking agency in New Jersey" called Audible Spectrum Records was "charging bands up to $350 per show, promising services and opportunities that were never delivered." "Battle of the Bands" are becoming increasingly common in both the U.S.A. and Europe, particularly the U.K. Typically, each band that enters the "battle" will pay a fee, returnable only if a minimum number of tickets is sold for the first round of the contest. Progress in the contest is dependent on "votes". A prize is usually given to the winner.

Satire of payola practices

In episode 6 of season 4 of the CBS show Cold Case, the detectives investigate the murder of a DJ in 1958 who was suspected of accepting a payola.

The Vancouver, BC, new wave band the Payola$ chose their moniker during the punk explosion of the late 1970s.

The practice was criticized in the chorus of the Dead Kennedys song "Pull My Strings", a parody of the song "My Sharona" ("My Payola") sung to a crowd of music industry leaders during a music award ceremony.

The They Might Be Giants song "Hey, Mr. DJ, I Thought You Said We Had a Deal" is another song about the practice. It is narrated from the point of view of a naive and inexperienced musician who has been coerced by a disc jockey into paying for airplay the disc jockey then disappears and does not deliver on his promise.

The song "Payola Blues" by Neil Young from his album Everybody's Rockin'. It opens by saying "This one's for you Alan Freed" and then states "'Cause the things they're doing today would make a saint out of you," implying that Payola corruption is bigger now than it was in the '50s.

The practice was also referenced in Billy Joel's song "We Didn't Start the Fire," during the verse dealing with the events of 1960.

"Sell Out" by the Reel Big Fish can be seen as a satire of payola scandals.

In 2002's video game "Grand Theft Auto: Vice City" the DJ for Flash FM, in a Freudian slip admits that the station used an inverted payola (the musicians paid the station off) scheme to have Love Fist's songs on the radio ahead of their concert.

The Basque country band Berri Txarrak record a LP/CD called Payola.

The Dead Milkmen song "Methodist Coloring Book" contains the line "God is honest; he don't take payola."

See also

References