In the 50s, Payola was the way to get the “DJs” to play the records that needed to achieve success on the airwaves. They knew that it was instantly the way to get airplay, and thereby sell records. It’s hard for them to keep it under control, I mean, there are so many creative ways to get something to someone without it going through the regular channels.

Happens everyday…

Federal law, including Federal Communications Commission (FCC) rules, requires that employees of broadcast stations, program producers, program suppliers and others who have accepted or agreed to receive payments, services, or other valuable consideration for airing material must disclose this fact to the broadcast licensee airing the material. This is required so that broadcasters have the information they need to disclose to their audiences that the material was paid for.

But wait, it’s happening today!

News! July 26, 2005. Big Payola Case Uncovered: New York Attorney General Eliot Spitzer has caught Sony BMG in the act. They have agreed to pay a ten million dollar settlement. Here are several articles about it. From New York Daily News. From Guardian Unlimited. From San Diego Union Tribune. From The Denver Post.

…and now, back to the article originally published August 5, 2003 and updated June 11, 2004:

When music was first played on the radio, the recording industry tried to ban it, claiming no one would buy records if they could hear music for free on the radio. That assertion was patently absurd. To appease the recording industry, radio stations agreed to pay small fees to licensing agencies such as ASCAP and BMI each time a song was played. This assured that the record company would receive payment for music in the form of royalties. The royalties they received were soon a pittance compared to what they paid out. It was almost instantly clear that radio was a better form of promotion than the music industry had ever dreamed of. People who heard music on the radio did buy records. When music fans heard a song they liked, they had to have a record of it, and the stores couldn’t keep them in stock. Soon this promotion was not free. If you produced a record, you wanted to sell it, and the only way to do that was to get it on the radio. To get that, you had to pay DJs and radio stations. Slip them a copy of the record with a one hundred dollar bill in the jacket, and they would play it. This was called “Payola”.

This system of pay for play went on all throughout the 1950s. Music did not get promoted for free. The recording industry, and artists complained to anyone who would listen that this was unfair, and in 1960 the practice of requiring a payment before a record would be played was outlawed. Many regulations governing the relationships between record companies and radio stations were passed in the ’60s and ’70s, so Payola is dead and gone, right? Wrong!

There are ways around the laws. The newest one it to make a song an ad. Here is an example. The D.J. announces something like “Here is Avril Lavigne’s Don’t Tell Me, presented by Arista Records.” That announcement makes the paid-for song an advertisement, and technically not a violation of any laws against payola. During just one week in May, WQZQ FM in Nashville played that song 109 times. On a single Sunday, WQZQ played that song 18 times, with as few as 11 minutes between airings of it. Garett Michaels, program director of San Diego rock station KBZT has said, “Basically, the radio station isn’t playing a song because they believe in it. They’re playing it because they’re being paid.” This is payola plain and simple. According to an article by Jeff Leeds of the Los Angeles Times, all five major record corporations have at least dabbled in the sales programs, industry sources said, with some reportedly paying as much as $60,000 in advertising fees to promote a single song.

An older way to get around payola laws is to use a middle man between the recording labels and radio stations called an “indie”, short for independent promoter. Record companies pay them to push their music. Radio stations take money from them to play songs. Payola is alive and well through these middle men. Nothing has really changed. If you want your song played on the radio, you better cough up dough, and a lot of it. Once you stop paying, your song will be dropped from play lists. Once again, recording labels and artists say this is unfair, and are complaining to Congress and the F.C.C. Read more in this Salon article and this ABCNEWS article.

What does all this have to do with dontbuycds.org? Lots. It is yet another corrupt practice of the recording and radio industries that we are angry about. It exploits artists and shortchanges fans, but more than that, it is a waste, especially when there is another method of promotion that works just as well, if not better, and is free: File trading networks. To paraphrase today’s youth: radio is old and busted, file trading is the new hotness.

It has been proven by study after study (see External Links for more info) that file trading is a great form of promotion. In its infancy, fans heard a new song on Napster, and had to have the CD. They rushed out and bought it. Unlike radio, the industry didn’t have to produce any payola to get a song listed on Napster. It was free! CD sales went up. At some point, greedy individuals decided that this was wrong. People were hearing the music they wanted almost on demand, and they didn’t have to pay for it, beyond paying for internet access. Record executives, radio executives, and independent promoters could not stand it, nor could a few already wealthy artists like Metallica’s Lars Ulrich. No one should be able to hear music without paying for it, so they claimed.

Just as radio had done in the early days, Napster tried to come to licensing terms with the recording industry, but the labels, save Bertelsmann, would not even talk to them. They ran crying to Congress and the courts until Napster was no more. Guess what? CD sales plummeted, and they tried to blame it all on “Piracy”. Not only had they looked the gift horse of a new and free promotion channel in the mouth, but they had it put down like an old nag. In some cases, the recording labels such as EMI messed up their own corrupt system of payola using their “copy protected” discs. They sent promotional copies of discs (read more) to radio stations in the hope of getting them played and promoted, but the stations had computer based CD players. The discs did not work. It was poetic justice that this hurt the recording label, but sad that it hurt the artists.

Why don’t they get it? Part of the problem is that file trading and CD burners are new technology, and old established industries have always feared new technology. The biggest part, however, is that greedy businessmen cannot tolerate competition. File trading networks are competition to all three parts of the payola system: the labels, the radio stations, and most of all, the indies. Once it is clear to all that radio is “old and busted,” and that file trading is “the new hotness,” the indies will be out of a very lucrative career.

To use an expression, the genie is out of the bottle. The recording industry, the radio industry, and the indies cannot just make file trading go away any more than the horse and buggy industry could just make automobiles go away. Maybe the labels will come to understand that promotion like Napster used to provide; like Kazaa and Morpheus now provide; is worth paying for. Maybe they will start giving the indies millions per year to payola the file trading networks. Maybe they could add tag lines saying what label artists use to the songs circulating on the net. They probably will not do this, as their apparent goal is to make all forms of entertainment pay-for-play.

It would be great for artists and fans if songs as ads, independent promoters, and all forms of payola were banned. That, however, is unlikely. All the players in the payola system may yet destroy each other in the end. We can only hope a new music industry of, by, and for people who love music can rise from the ashes when they are gone.

[ Source: The FCC's Payola Rules" ]
[ Source: Today's Payola Story ]