Will The FCC Payola Settlement Matter?


The recent FCC payola probe and $12.5 million settlement with Clear Channel (1100Fcc_14 radio stations), CBS Radio (180 stations),  Entercom (103 stations) and Citadel Broadcasting (213
stations) represented according to he commission "by far the largest collective fine ever paid".

Indie label trade group A2IM also announced a side agreement with the station groups A2im_7that included 8400 half hour blocks of airtime devoted to independent music and a new Radio Rules Of Engagement designed to give indie labels more equal access to the airwaves.  "We
have emerged from a truly remarkable negotiation where both sides have been motivated to do the right things for the right reasons to benefit the listener," A2IM Board member Peter Gordon and head of indie label Thirsty Ear told FMQB. "This radio group is embracing a creative solution to a difficult problem to the benefit of all and they should be commended.”

But the $12.5 million "largest collective fine ever" was also paid by a consolidated largest collective group of stations ever.  Broken down by station it amounts to a mere $7832.00 per or little moreRadio_tower_12 than the revenue from a few prime time major market radio ads.
Hardly a harsh punishment.

8400 isolated half hours of independent music although laudable seems unlikely to level
the playing field when measured alongside the more than 215,000 half hour blocks that these same 1596 stations program every month. 
And does indie music really benefit when it is deliberately segregated from major label product?

But what about the new Radio Rules Of Engagement? 5-10 years ago pledges like "Radio should
establish…clear and non-discriminatory procedures for music submissions and access to radio station music programmers" might have had an impact. But in a era of shrinking formats with tightened play lists chosen by overworked and inaccessible national programmers driven by research and demands of quarterly profits do non-binding promises really matter?

Money_12The real winners in this latest round of payola probes and settlements may in fact be the major labels who have been able to end the use of expensive independent promotion "consultants" and costly  marketing "gifts", contests and concert appearances substituting a few national promotion execs talking to a few national program directors. 

If more independent music finds its way onto the sales charts it will be because labels and music marketers embraced new media and technologies and not because of this week’s FCC settlement and A2IM capitulation.

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